NEW YORK (AP) — U.S. stocks slipped as the market’s big burst following Donald Trump’s election continued to cool. The S&P 500 dipped 0.6% Thursday. The Dow Jones Industrial Average dropped 0.5%, and the Nasdaq composite sank 0.6%. Several areas of the market that had bounced highest following Trump’s election reversed their momentum and led the way lower. Tesla sank to just its second loss since Election Day, while smaller stocks fell harder than the rest of the market. Short-term Treasury yields swung following the latest economic reports before rising after Chair Jerome Powell said the Federal Reserve is not in a hurry to cut interest rates.
THIS IS A BREAKING NEWS UPDATE. AP’s earlier story follows below.
NEW YORK (AP) — U.S. stocks are edging lower Thursday as the following continues .
The S&P 500 was down 0.3% in afternoon trading, though still near its set on Monday. The Dow Jones Industrial Average was down 85 points, or 0.2%, as of 2:56 p.m. Eastern time, and the Nasdaq composite was 0.3% lower.
Cisco Systems' 2.1% drop weighed on the market, even though the tech giant reported stronger profit for the latest quarter than analysts expected. Investors may have been looking for it to raise its financial forecasts more, analysts suggested.
The stock market broadly has been rising faster than corporate profits, which has raised criticism from skeptics that it's gotten too expensive.
Super Micro Computer, which has been one of the biggest winners of the artificial-intelligence boom, tumbled 11.3% for one of the worst losses in the S&P 500 after telling U.S. regulators it needs more time to file its financial statements for the latest quarter, which ended in September.
The server maker's stock has been struggling recently, particularly after Ernst & Young . A special committee of the company's board has since said that a three-month investigation found “no evidence of fraud or misconduct on the part of management or the Board of Directors.”
Some of the stocks that have felt the biggest bump from Trump's election also lost momentum. Tesla fell 5.1% and was on track for just its second loss since Election Day. It's run by Elon Musk, who has become a close Trump ally.
Smaller stocks also lagged the rest of the market, and the Russell 2000 index of small stocks was down 0.9%. It's a turnaround from the election's immediate aftermath, when the thought was that an “America First” president would benefit companies that do business domestically over big multinationals that could be hurt by tariffs and trade wars.
Even though of the White House, Senate and House of Representatives, which could give them more leeway to push through their policies, “promises made on the campaign trail may not be implemented immediately, with final legislation likely to be a pared-down version of the original proposals,” according to Solita Marcelli, chief investment officer, Americas, at UBS Global Wealth Management.
Helping to keep Wall Street's losses in check was The Walt Disney Co., which jumped 6.9% after for the latest quarter than analysts expected. CEO Robert Iger credited improved profits at its streaming businesses and strong box-office results for its movies, including “Inside Out 2” and “Deadpool & Wolverine,” among other things.
Tapestry shares climbed 13% after the luxury fashion company said it’s , another luxury brand owner. The companies agreed to an $8.5 billion deal last year to unite the makers of Coach and Michael Kors handbags, but the tie-up faced numerous challenges, including a lawsuit from the Federal Trade Commission to block the deal on antitrust grounds.
Capri shares rose 6.1% after erasing a morning loss.
Stocks were also feeling the effects of swinging yields in the bond market following the . Prices paid at the U.S. wholesale level were 2.4% higher in October from a year earlier. That was an acceleration from September’s 1.9% inflation rate and a worse jump than economists expected.
A separate report, meanwhile, suggested the U.S. job market remains solid. last week in the latest signal that layoffs aren’t taking off.
Treasury yields initially jumped following the reports, as traders trimmed their expectations a bit for a coming cut to interest rates by the Federal Reserve at its meeting next month. But yields later regressed, and the yield on the 10-year Treasury eased to 4.41% from 4.45% late Wednesday.
The Fed began cutting rates from their two-decade high in September to offer support for the job market, hoping to after bringing to its target of 2%. Prior forecasts published by the Fed implied it could keep cutting rates through next year.
But Trump’s victory may have scrambled such plans. Economists say his preferences for , higher tariffs and less regulation could ultimately lead to , along with faster economic growth.
While lower interest rates can give a boost to the economy and to prices for investments, they can also give inflation more fuel.
In stock markets abroad, European indexes were higher, including a 1.4% jump for Germany’s DAX. Asian markets were mixed, meanwhile. Hong Kong’s Hang Seng dropped 2%, but South Korea’s Kospi added 0.1%.
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AP Business Writers Matt Ott and Elaine Kurtenbach contributed.
Stan Choe, The Associated Press
