Stocks finished down Tuesday, with the market eking out a small gain for the month, a fitting end to a difficult month that saw Wall Street battered by concerns about a future recession, inflation, and increasing interest rates.
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The S&P 500 lost 0.6%, recouping over half of its earlier-day loss. The Dow Jones Industrial Average sank 0.7%, while the Nasdaq Composite fell 0.4%. Both companies recovered some of their losses after losing at least 1.4%.
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Such swings should perhaps be no surprise given Wall Street’s action this month, amid some of the wildest trading since the early days of the pandemic. The S&P 500 finished the month with a gain of less than 0.1%, which followed an 8.8% slump in April. The index is now 13.9% below its record set early this year. But the slight move for the month belies sharp lurches down and up that shook investors along the way.
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Through mid-May, the S&P 500 tumbled to seven straight losing weeks for its longest such streak since the dot-com bubble was deflating two decades ago. Slowing data on the U.S. economy heightened worries that high inflation will force the Federal Reserve to raise interest rates so aggressively that it will cause a recession.
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The S&P 500 fell 26.09 points to 4,132.15, while the Dow lost 222.84 points at 32,990.12. The Nasdaq dropped 49.74 points to 12,081.39.
Smaller company stocks feel more than the broader market. The Russell 2000 slid 23.85 points, or 1.3%, to 1,864.04.
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Highlighting the worries about inflation, oil prices briefly rose Tuesday after the European Union agreed to block the majority of oil imports from Russia because of its invasion of Ukraine. Benchmark U.S. crude ended up falling 0.3% to settle at $114.67 per barrel. Brent crude, the international standard, rose 1% to settle at $122.84 per barrel.
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The jump of more than 50% in oil prices so far this year has been a big contributor to the very high inflation sweeping the world. Earlier Tuesday, a report showed inflation in the 19 countries that use the euro currency hit 8.1% in May, the highest level since records began in 1997.
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Stocks have managed to avoid a full-blown bear market, at least so far, with the S&P 500 yet to close more than 20% below its record. The S&P 500 is coming off its best week in a year and a half, in part on hopes that inflation may have hit its peak and will begin moderating. Speculation has grown that the Fed may consider a pause in rate hikes at its September meeting.
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On Wall Street, health care, technology and energy stocks were among the biggest drags on the market. UnitedHealth Group fell 2%, Adobe dropped 2.7% and Chevron slid 2%.
Some areas of the stock market that has been particularly hard hit this year also climbed, including internet-related stocks. Amazon rose 4.4%, and the Class A shares of Google’s parent company gained 1.1%.
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U.S. Treasury yields rose following reports showing confidence among U.S. consumers was higher than economists expected and home prices rose more than forecast.
The yield on the 10-year Treasury climbed to 2.85% from 2.75% late Friday.