U.S. stocks cut sharp losses and ended the wild session far off their lows on Wednesday as cryptocurrency prices largely recovered, but the weakness in speculative pockets of the market still weighed on sentiment.
The Dow Jones Industrial Average closed 164.62 points lower, or 0.5% to 33,896.04 after dropping 586 points at its low of the day.
The S&P 500 fell 0.3% to 4,115.68 as nine out of 11 sectors registered losses.
The tech-heavy Nasdaq Composite rebounded from a 1.7% loss earlier and closed flat at 13,299.74 as some of the major tech stocks reversed higher including Facebook, Netflix, Microsoft and Alphabet.
The major averages briefly added to their losses in afternoon trading after the Federal Reserve’s minutes from its April meeting hinted at reconsidering its asset purchase programs in upcoming meetings.
Wall Street had another wild session with tech stocks sliding in the morning as investors were rattled by a sudden plunge in cryptocurrencies, including bitcoin. Later the weakness spilled over into other sectors with the S&P 500 dropping 1.6% at its session low. The exception was a handful of retailers that reported solid earnings, including Target.
Growth stocks have come under pressure lately with the Nasdaq Composite falling nearly 5% in May as fears of inflation intensified. A sustained pickup in price pressures could unravel the Federal Reserve’s accommodative policies, which could hurt technology companies that have relied for years on easy borrowing costs for superior growth.
Reference: CNBC
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