NEW YORK (AP) 鈥� Wall Street slumped after a morning rally evaporated, but the losses weren鈥檛 as bad as the manic moves that wracked markets worldwide over the last week. The S&P 500 fell 0.8% Wednesday. The Dow Jones Industrial Average fell 0.6%, and the Nasdaq composite dropped 1%. Stocks swung lower as Nvidia, one of Wall Street鈥檚 most influential companies, went from a morning gain to a loss of 5.1%, making it the heaviest weight on the S&P 500. Nvidia and other Big Tech stocks have been struggling on worries their prices shot too high amid Wall Street鈥檚 frenzy around artificial-intelligence technology.
THIS IS A BREAKING NEWS UPDATE. AP鈥檚 earlier story follows below.
NEW YORK (AP) 鈥� U.S. stocks are subdued Wednesday after a morning rally gave way to modest declines, but Wall Street is still holding relatively steady compared with its manic swings over the last week.
The S&P 500 was 0.4% lower in afternoon trading after an earlier jump of 1.7% evaporated. The Dow Jones Industrial Average was down 179 points, or 0.5%, as of 2:30 p.m. Eastern time, and the Nasdaq composite was 0.6% lower.
Stocks swung lower as , one of Wall Street鈥檚 most influential companies, went from a morning gain of 4.4% and pushing strongly upward on the S&P 500 to a loss of 3.8% that made it the index's heaviest weight. Nvidia and other Big Tech stocks have been largely struggling the last month on worries their prices shot too high amid Wall Street's technology.
A profit report from Super Micro Computer, whose stock more than quadrupled in the first two and a half months of the year, helped further mar excitement around AI. Even though its revenue soared 143% in the latest quarter, profit for the company that sells server and storage systems used in AI and other computing fell short of analysts' high expectations. Its stock tumbled 19.4%.
Still, the day's moves for U.S. stock indexes looked like modest ripples compared with the waves that have been crashing through global markets since last week. The S&P 500 is coming off a that broke a brutal three-day where it tumbled a bit more than 6%.
Several reasons were likely behind the slide for markets worldwide, and one of them that鈥檚 centered in Japan seems to be calming. The raised its main interest rate by only a bit last week, but the move nevertheless sent aftershocks worldwide. It scrambled among some hedge funds and other investors, who borrowed money for very cheap in Japanese yen and then invested it elsewhere around the world.
Speaking to business leaders in the northern island of Hokkaido, , deputy governor of the Bank of Japan, acknowledged the recent market turmoil, which was also triggered in part by concerns about the .
Japan鈥檚 central bank can afford to wait, he said, and 鈥渨ill not raise its policy interest rate when financial and capital markets are unstable.鈥� He also said he believed the U.S. economy would have a 鈥渟oft landing鈥� and , even if fears have risen the Federal Reserve has kept too high for too long in hopes of stifling .
The Japanese promise offered a balm for markets, nervous about additional moves by the Bank of Japan, which only recently ended its yearslong campaign to keep interest rates below zero.
But it also highlights how risks may remain, suggesting there鈥檚 still room left for the popular 鈥渃arry鈥� trade to unwind and that some hedge funds and other investors may 鈥渟till remain offsides,鈥� according to John Lynch, chief investment officer for Comerica Wealth Management.
Japan鈥檚 rate hike last week sent the value of the Japanese yen soaring, and the resulting exit of investments by those hedge funds likely slapped turbochargers onto market losses, including the for the Nikkei 225 since the Black Monday crash of 1987.
The value of the Japanese yen is one of the first things Darrell Cronk, chief investment officer for Wealth & Investment Management at Wells Fargo, checks now when he wakes each morning because it shows how much the 鈥渃arry鈥� trade is unwinding.
The other thing Cronk checks is the two-year Treasury yield, which he says shows where the market wants or needs the Federal Reserve to take its main interest rate.
Treasury yields tumbled sharply Monday, when fear in the market was spiking and investors were speculating the Federal Reserve could even have to call an emergency meeting to cut interest rates quickly. But they've steadied since then.
The yield on the two-year Treasury edged up to 4.00% Wednesday from 3.99% late Tuesday.
The expectation on Wall Street is for the Fed to cut its main interest rate at its next scheduled meeting next month by either the traditional quarter of a percentage point or the more severe half of a point.
In the meantime, earnings reports from the biggest U.S. companies continue to roll in, and the growth for those in the S&P 500 index may end up being the best since 2021, according to FactSet.
The Walt Disney Co. delivered stronger earnings for the latest quarter than analysts expected, and its for the first time. But its stock nevertheless fell 3.1% after it warned recent softness it saw at its U.S. theme parks could continue for 鈥渢he next few quarters.鈥�
Airbnb tumbled 14.4% after fell short of analysts鈥� expectations, and it told investors that it saw some signs of slowing demand in the U.S.
Helping to limit the market's losses was Apple, which rose 1.2%. It was clawing back losses from earlier in the week after disclosed it had slashed its ownership stake in the iPhone maker.
In stock markets abroad, indexes climbed across much of Europe and Asia.
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AP Business Writer Matt Ott contributed.
Stan Choe, The Associated Press
