Stock market today: Wall Street wavers as Big Tech stocks fall

NEW YORK (AP) — Stocks wavered in afternoon trading on Wednesday, as losses for several Big Tech companies offset gains elsewhere in the market.

The S&P 500 fell 0.5% in afternoon trading, even though more stocks were rising than falling in the index. The Dow Jones Industrial Average fell 78 points, or 0.2%, as of 12:33 p.m. Eastern time. Both indexes set records on Tuesday.

The Nasdaq composite fell 1.1%.

Losses for tech heavyweights helped pull the broader market lower. Semiconductor giant Nvidia slipped 3.3%. Its huge value gives it outsized influence on market indexes. Microsoft fell 1.1%

Several personal computer makers added to Big Tech's heavy weight on the market following their latest earnings reports.

HP sank 12.6% after giving investors a weaker-than-expected earnings forecast for its current quarter. Dell slumped 12.1% after its latest quarterly revenue fell short of Wall Street forecasts.

Gains for financial and health care companies helped counter Big Tech's downward pull.

The U.S. economy expanded at a healthy 2.8% annual pace from July through September, according to the Commerce Department, leaving its original estimate of third-quarter growth unchanged. The growth was driven by strong consumer spending and a surge in exports.

The update follows a report on Tuesday from the Conference Board that said confidence among U.S. consumers improved in November, but not by as much as economists expected.

Consumers have been driving economic growth, but the latest round of earnings reports from retailers shows a mixed and more cautious picture.

Department store operator Nordstrom fell 10.3% after warning investors about a trend toward weakening sales that started in late October. Clothing retailer Urban Outfitters jumped 15.9% after beating analysts’ third-quarter financial forecasts. Weeks earlier, retail giant Target gave investors a discouraging forecast for the holiday season, while Walmart provided a more encouraging forecast.

Consumers, though resilient, are still facing pressure from inflation. The latest update from the U.S. government shows that inflation accelerated last month. The personal consumption expenditures index, or PCE, rose to 2.3% in October from 2.1% in September.

Overall, the rate of inflation has been falling broadly since it peaked more than two years ago. The PCE, which is the Federal Reserve's preferred measure of inflation, was just below 7.3% in June of 2022. Another measure of inflation, the consumer price index, peaked at 9.1% at the same time.

The latest inflation data, though, is a sign that the rate of inflation seems to be stalling as it falls to within range of the Fed's target of 2%. The central bank started raising its benchmark interest rate from near-zero in early 2022 to a two-decade high by the middle of 2023 and held it there in order to tame inflation.

The Fed started cutting its benchmark interest rate in September, followed by a second cut in November. Wall Street expects a similar quarter-point cut at the central bank's upcoming meeting in December.

“Today’s data shouldn’t change views of the likely path for disinflation, however bumpy," said David Alcaly, lead macroeconomic strategist at Lazard Asset Management. "But a lot of observers, probably including some at the Fed, are looking for reasons to get more hawkish on the outlook given the potential for inflationary policy change like new tariffs.”

President-elect Donald Trump has said he plans to impose sweeping new tariffs on Mexico, Canada and China when he takes office in January. That could shock the economy by raising prices on a wide range of goods and accelerating the rate of inflation. Such a shift could prompt the Fed to rethink future cuts to interest rates.

Treasury yields slipped in the bond market. The yield on the 10-year Treasury fell to 4.24% from 4.30% late Tuesday. The yield on the two-year Treasury, which more closely follows expected actions by the Fed, fell to 4.21% from 4.25% late Tuesday.

U.S. markets will be closed Thursday for Thanksgiving.