Unrelentingly high Treasury yields and an uncertain government spending picture cast a long shadow on stocks Wednesday as all three major indexes fell hard and finished the day near session lows. The Dow Jones Industrial Average took the worst of it as blue chips dropped more than 800 points, leaving all but one of the index's 30 stocks in the red on the stock market today.
The bears took control of the Dow and didn't let go. The index lost 816 points by the end of the day, a fall of 1.9%, and pushed blue chips below their 200-day moving average. The only Dow stock that posted a gain was Coca-Cola, which edged 0.2% higher. Troubled UnitedHealth Group paved the losing path with a fall of nearly 6%.
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The S&P 500's loss came in at 1.6% while the Nasdaq succumbed and traded its midmorning gains for a 1.4% loss on Wednesday. Among the S&P sectors, communication services was the sole gainer while real estate, health and utilities lagged the most.
The sell-off came as legislators rushed to secure enough votes to pass President Donald Trump's "big beautiful bill," a budget that includes changes to state and local tax deductions. But many traders worried the spending plan would heap more weight on an already heavy national deficit.
As a result, the yield on the benchmark 10-year Treasury note kept climbing throughout the day, and was up 11 basis points to 4.59% by the time the market closed.
Volume came in more than 20% higher on both the New York Stock Exchange and Nasdaq compared with the same time on Tuesday, creating distribution days for both. Decliners dictated the action by outnumbering advancers by 9-to-1 on the NYSE. Losers outnumbered winners on the Nasdaq by more than 4-to-1.
The small-cap Russell 2000 plunged 2.8%, while the Innovator IBD 50 exchange traded fund surrendered earlier gains and lost 0.9% at the finish. The fund broke a three-day winning streak.
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Magnificent Seven stock Apple was weighed down amid reports that OpenAI would buy an artificial-intelligence company founded by former Apple design chief Jony Ive. Apple slipped more than 2% as it faces resistance at a downward sloping 50-day moving average.
Elsewhere, Nvidia gave back morning gains and fell nearly 2% after Chief Executive Jensen Huang noted that U.S. export curbs on advanced chips haven't been working because China is ramping up its artificial intelligence technologies.
Huang says the artificial intelligence chip giant has been losing market share to Chinese rivals over the past four years.
Tesla gave back early gains and slipped nearly 3% lower amid great expectations for its robotaxi launch in Austin, Texas, in June. On Tuesday, Chief Executive Elon Musk said he would spend more time with the company. Meanwhile, Tesla analyst Dan Ives said the company is entering a "golden era" and could reach $2 trillion in market cap.
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Alphabet Impresses Wall Street
Alphabet ran counter to the overall markets and surged nearly 3% by the close. The Google parent reportedly impressed analysts at its I/O conference Tuesday with an array of artificial intelligence products that showed it was moving forward with the technology.
Google shares cleared their 200-day moving average as well as an early entry at 170.63 before pulling back. It was the biggest gainer in the S&P 500 and the Nasdaq.
In economic news, S&P Global's Purchasing Managers' Index is due Thursday. The index is expected to slip to 49.8 for manufacturing in May after April's 50.2. In services, the index is seen softening to 50.6 from April's 50.8.
3:20 p.m. ET
Here Come The Gold Stocks Again
While the rest of the market languished, gold stocks made gains. Agnico-Eagle Mines became the latest addition to Investor's Business Daily's model portfolio Leaderboard as shares rebounded from their 21-day moving average. Shares were up nearly 3%.
Other gold stocks were setting up as well. Newmont rose in a cup-with-handle base with a buy point of 57.16. AngloGold Ashanti edged lower, however, as it tested a trendline entry near 43.41.
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Elsewhere, telecom infrastructure stock Dycom gapped up past a buy point of 207.20. In heavy construction, Argan edged into a buy zone from a buy point of 191.46.
Among cryptocurrencies, bitcoin edged past its Jan. 20 high of $108,659 and reached a high-water mark of $109,298.77, according to CoinMarketCap. Sentiment is turning in favor of the cryptocurrency after the Senate moved a bill on Monday for stablecoins. Further, stablecoins are pegged to a currency, usually the U.S. dollar.
12:19 p.m. ET
Dow Jones Stocks: UnitedHealth Falls
Among Dow Jones stocks, UnitedHealth fell after analysts at HSBC downgraded shares to reduce from hold and lowered their price target to 270 from 490. UnitedHealth reversed after a three-day winning streak but remains in a deep downtrend.
Nearly all of the other blue chips were in negative territory.
Cisco Systems is forming a handle entry at 65.75 thanks to an earnings gap-up.
11:06 a.m. ET
Stock Market Today: Palo Alto, Target Fall
Earnings moved cybersecurity stock Palo Alto Networks. Though the company beat sales and earnings estimates slightly, shares fell. Earnings of 80 cents per share rose 21%, above views for 77 cents per share. Sales grew 15% to $2.3 billion compared with expectations of $2.28 billion.
For the current quarter, the company expects earnings of 88 cents per share at the midpoint, on sales of $2.5 billion. Shares had formed a cup with handle with a buy point of 195.42, but fell more than 5% on Wednesday. Still, the stock appeared to be finding support at its 50-day moving average.
Among big box retailers, Target missed earnings estimates and gave a weak outlook. Earnings dropped to $1.30 per share from $2.03 per share a year ago, missing analyst estimates for $1.61 per share. Revenue also fell, to $23.8 billion, missing views of $24.22 billion.
The company noted that it faced a "challenging environment" due to tariffs and expects sales to decline in the low single digits for the year with midpoint earnings of $8 per share. Shares were trying to get past resistance at their 50-day moving average but fell more than 5% after results.
Elsewhere, Wolfspeed plunged 70% after The Wall Street Journal reported that the chipmaker is preparing to file for bankruptcy to resolve its debt. Shares have crashed from their November 2021 high of 142.33 and have been trading under $5.
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