Stocks slip on Wall Street, erasing weekly gains for S&P 500

Pedestrians walk past the New York Stock Exchange, on July 8, 2022, in New York. Stocks are opening lower on Wall Street Wednesday, Aug. 17, as traders absorb some discouraging news about how much Americans are spending. (AP Photo/John Minchillo, file)

NEW YORK (AP) — Stocks are moving broadly lower on Wall Street in afternoon trading Wednesday, led by drops in big technology companies and erasing the S&P 500′s gains for the week.

The S&P 500 slipped 1.1% as of 12:03 p.m. Eastern. Trading has been choppy throughout the week as the benchmark index comes off a four-week winning streak.

The Dow Jones Industrial Average fell 272 points, or 0.8%, to 33,880 and the Nasdaq fell 1.7%.

Small-company stocks fell more sharply than the rest of the market. The Russell 2000 fell 2%.

Pricey technology companies and retailers had some of the biggest losses. Utilities and makers of essential consumer products, which are typically considered less risky, held up better than the broader market.

Wall Street was absorbing a mix of retail updates that showed inflation pressure continues to affect businesses and consumers, but also shows that spending remains strong.

Target fell 3.2% after reporting a nearly 90% plunge in second quarter profits as it was forced to slash prices to clear unwanted inventories. The retailer warned earlier this summer that it was canceling orders from suppliers and aggressively cutting prices because of a pronounced spending shift by Americans as the pandemic eased.

Children’s clothing and accessories chain Children's Place fell 14.8% after reporting a surprise second-quarter loss as it faced supply chain problems and pressure from inflation.

Bond yields rose significantly. The yield on the 10-year Treasury rose to 2.91% from 2.81% late Tuesday.

Sales at U.S. retailers were unchanged last month, according to the Commerce Department, and economists had expected a slight increase in July. Part of the weakness came from a 1.8% drop in gas sales, reflecting lower prices at the pump.

Wall Street has been closely reviewing the latest economic data and corporate updates to get a better sense of how inflation is affecting businesses and consumers and whether the hottest inflation in 40 years is peaking or beginning to cool. Investors are also monitoring inflation to determine how much further central banks have to go in their fight against higher prices.

Britain’s inflation rate rose to a new 40-year high of 10.1% in July, a faster pace than in the U.S. and Europe as climbing food prices in the United Kingdom tightened a cost-of-living squeeze fueled by the soaring cost of energy. Inflation pressures prompted the Bank of England to boost its key interest rate by half a percentage point this month, the biggest of six consecutive increases since December.

The Federal Reserve has been raising interest rates in order to slow the economy and temper inflation, but investors remain concerned that it could hit the brakes too hard and send the economy into a recession. The Fed in July raised its benchmark interest rate by three-quarters of a point for a second-straight time. Wall Street will get more details on the process behind that decision when the Fed releases minutes from that meeting later Wednesday.