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US Stocks Slump Wednesday              10/05 10:33

   Stocks fell in morning trading on Wall Street Wednesday and gave back some 
of the big gains from earlier this week as rising bond yields amp up pressure 
on markets again.

   NEW YORK (AP) -- Stocks fell in morning trading on Wall Street Wednesday and 
gave back some of the big gains from earlier this week as rising bond yields 
amp up pressure on markets again.

   The S&P 500 fell 1.5% as of 10:15 a.m. Eastern. The benchmark index is 
coming off its best two-day rally since the spring of 2020.

   The Dow Jones Industrial Average fell 340 points, or 1.2%, to 29,967 and the 
Nasdaq fell 1.9%.

   The broader market is still bruised from its stumble in September, but 
investors have been hoping that signs of a softening economy may convince 
central banks to temper their aggressive interest rate hikes. Wall Street is 
also preparing for the next round of corporate earnings reports to get a better 
sense of how hard the hottest inflation in four decades is squeezing businesses 
and consumers.

   Technology stocks and retailers led the broad losses Wednesday. Microsoft 
fell 1.6% and Amazon fell 1.9%.

   Treasury yields rose and applied more pressure to stocks after several days 
of relief. The yield on the 10-year Treasury, which helps set rates for 
mortgages and many other kinds of loans, rose significantly to 3.76% from 3.61% 
late Tuesday.

   The yield on the two-year Treasury, which more closely tracks expectations 
for Federal Reserve action, rose to 4.19% from 4.10% late Monday.

   Energy stocks held up better than the rest of the market. The OPEC+ cartel 
of oil-exporting countries is debating a potentially large cut in the amount of 
crude it ships to the global economy, which would likely result in higher oil 
and gasoline prices.

   Higher energy prices, particularly for gasoline, were a big reason for 
inflation's surge earlier in the year. Stubbornly hot inflation, despite energy 
costs easing over the last few months, remains a big focus for Wall Street. The 
Fed and other central banks have been raising interest rates to make borrowing 
more difficult and slow economic growth, but Wall Street is concerned that the 
potential solution for high inflation could result in a recession.

   Investors are looking for signs that the economy is slowing enough to allow 
central banks a reason to ease up on rate hikes. Some signs this week included 
a tamer rate hike by Australia's central bank and a U.S. report showing that 
the number of available jobs plummeted in August.

   Employment has been a particularly strong area of the economy and any signs 
that the hot job market is cooling could mean that inflation might follow. 
Analysts have said such hopes may be premature. A report on U.S. job growth at 
private employers came in stronger than expected Wednesday, as did a report on 
the services sector.

   Wall Street will get a more detailed look at employment in the U.S. on 
Friday with the government's monthly jobs report for September.

   The Fed has said it is determined to continue raising interest rates until 
it is satisfied that inflation is under control. That resolve has been echoed 
by some central banks globally.

   New Zealand's central bank raised its benchmark interest rate to 3.5%, 
saying inflation remained too high, most recently at 7.3%, and labor scarce. 
The half-point rate increase was the fifth in a row by the Reserve Bank of New 
Zealand since February.

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