Investors sold technology shares Wednesday, sapping momentum from major stock indexes, as volatility continued to reverberate across the market.
The Dow Jones Industrial Average opened higher, rising as much as 234 points and setting an intraday high, after several banks kicked off the latest earnings-reporting season with blowout profit reports.
But the blue-chip index gave up a significant chunk of the gain as the day wore on. Much of it evaporated after the release of a Federal Reserve report Wednesday afternoon saying the U.S. economy accelerated to a moderate pace and showed signs that businesses were raising prices between February and early April.
Investors ramped up their selling of tech stocks and shares of other high-growth companies following the release of the report, undoing some of the group’s recent gains and acting as a drag on the broader market. Investors have soured on the tech trade whenever signs have suggested the economy is strengthening and inflation is rising, which would eventually lead to higher interest rates. And higher rates dent the future earnings of tech and other companies.
The Dow ended the session up 53.62 points, or 0.2%, to 33730.89, off 0.2% from Friday’s closing record. The S&P 500, which also hit its highest-ever level earlier in the session, slid into the red, shedding 16.93 points, or 0.4%, to 4124.66. And the Nasdaq Composite fell further, declining 138.26 points, or 1%, to 13857.84.