By Yasin Ebrahim
Investing.com – The S&P 500 slipped Wednesday as technology attempted to find a bottom after the tech-heavy Nasdaq slipped into correction territory, but struggling bank stocks weighed on the broader market gains in check.
The S&P 500 fell 0.2%, the Dow Jones Industrial Average slipped 0.4%, or 142 points, the Nasdaq lost 0.2%.
Technology, which has led the weakness in the broader market, was supported as U.S. Treasury yields took a breather, with 10-year easing from two-year highs, despite growing expectations for aggressive Fed action.
“Given the fast-changing Fed rhetoric and inflation trends that remain stubbornly high, we are increasing our rate hike expectation from two to four next year. Our 2022 year-end federal funds rate target is now 1.00%–1.25%,” Wells Fargo said in a note.
Alphabet (NASDAQ:GOOGL), Meta Platforms (NASDAQ:FB), and Microsoft (NASDAQ:MSFT) were in the ascendency offsetting a slip in Amazon (NASDAQ:AMZN) and Apple Inc (NASDAQ:AAPL) just a week ahead of quarterly results from big tech.
Apple is set to kick off earnings for big tech next week, with analysts on Wall Street touting a strong quarter of growth for the tech giant’s services business, powered by continued growth its App Store.
Noting industry data from researcher Sensor Tower, {{0| Bank of America (NYSE:BAC) said it expected App Store sales to have grown 12% in fiscal first quarter compared with the same period a year ago.
Communication services was also among the biggest sector gainers, led by video game stocks in the wake of Microsoft’s deal to buy Activision Blizzard (NASDAQ:ATVI).
Take-Two Interactive Software (NASDAQ:TTWO) and Electronic Arts Inc (NASDAQ:EA) led the pack, with the latter receiving an upgrade from Atlantic Equities to overweight from buy, with a price target of $160 target price.
Banking stocks, meanwhile, continued to slip, keeping the broader financials in red as gains in Morgan Stanley and Bank of America on better-than-expected third-quarter earnings was overshadowed by a slump in regional banking stocks.
U.S. Bancorp (NYSE:USB) fell more than 6% after reporting fourth-quarter earnings that fell short of expectations as lower net interest margin weighed on performance.
State Street (NYSE:STT) slipped more than 5% despite reporting a beat on both the top and bottom lines.
Energy was also a drag on the broader market as oil prices gave up some gains after surging on news of supply disruptions following an explosion at an oil pipeline that transports up to 450,000 barrels of crude oil per day from Iraq to Turkey.
In other news, SoFi Technologies (NASDAQ:SOFI) received regulatory approval to become a bank holding company, sending its shares more 15% higher.