Stock market today: Wall Street rebounds after its fall as Big Tech takes back the reins

NEW YORK (AP) Big Tech's jumps on Thursday helped U.S. stock indexes recover much of their decline from the day before.

The S&P 500 rose 38.42 points, or 0.7%, to 5,199.06 and recouped most of its earlier loss, caused by concerns that interest rates could remain high for some time . The Nasdaq Composite Index rose 271.84, or 1.7%, to a record 16,442.20. The Dow Jones Industrial Average, which places less emphasis on technology, lagged. It slipped 2.43 points, or less than 0.1%, to 38,459.08.

Apple was the main force pushing the market higher, and it climbed 4.3% to pare its loss for the year so far. Nvidia was close behind as it continues to embark on a frenzy around artificial intelligence technology. The chip company rose 4.1% to bring its annual gain to 83%. Amazon added 1.7% and set a record after surpassing its previous record in 2021.

This is a return to last year's form, when a handful of Big Tech stocks were responsible for the majority of the market's gains. This year, the gains were spread out. Until concerns about stubbornly high inflation cool financial markets.

In the bond market, which has driven much of the action on Wall Street, Treasury yields remained relatively stable following a batch of mixed data on inflation and the U.S. economy.

One of the biggest questions dominating Wall Street is when or if the Federal Reserve will make the interest rate cuts traders dream of. After starting the year predicting at least six rate cuts, traders have since significantly lowered their expectations. A series of warmer-than-expected reports on inflation and the economy have raised concerns that inflation's progress over the past year has stalled. Many traders now expect just two cuts in 2024, with some discussing the possibility of zero cuts.

A report released Thursday morning showed that inflation at the wholesale level was a little lower last month than economists expected. That's encouraging, but the data also showed that underlying inflation trends were closer to forecasts, if not slightly higher. These figures do not take into account the effects of fuel prices and some other notoriously volatile prices, and economists say they can give a better idea of ​​where inflation is heading.

The update doesn't make up for Wednesday's disappointing report on U.S. consumer inflation, but it could ease investors' nerves, at least in the short term, said Chris Larkin, managing director of trading and investments at E-Trade at Morgan Stanley.

A separate report said fewer U.S. workers filed for unemployment benefits last week. It's the latest signal that the job market remains remarkably strong despite high interest rates.

The Federal Reserve has kept its main interest rate at the highest level since 2001 in hopes of lowering the economy and investment prices enough to bring high inflation under control. The fear is that rates held too high for too long due to stubbornly high inflation could cause a recession.

Some investors are now warning that any rate cut by the Fed could be seen as a wake-up call more than anything, and could only happen if the economy and job market weaken enough to require an additional hike.

All of this comes at a time when critics were already calling the U.S. stock market too expensive after its jump of more than 20% since Halloween. For stock prices to appear more reasonable, without requiring sharp declines, either interest rates would need to fall or corporate profits would need to strengthen.

Earnings reporting season has just begun, as companies tell investors how much they earned in the first three months of the year.

Rent the Runway more than doubled after reporting slightly better-than-expected revenue for its latest quarter. The company, which allows customers to rent designer clothing, also said it expects to break even based on its cash flow in the next financial year. Its stock soared 161.9%.

Alpine Immune Sciences soared 36.9% after Vertex Pharmaceuticals agreed to buy the biotechnology company for $4.9 billion in cash. Summit added 0.7%

CarMax suffered one of the biggest losses in the S&P 500 after reporting weaker earnings than analysts expected for its latest quarter. Rising interest rates on auto loans are making the sector more difficult, alongside tightening lending standards and low consumer confidence. Its action skidded 9.2%.

On the bond market, the yield on 10-year Treasury bills rose from 4.55% Wednesday evening to 4.57%. The two-year yield, which more closely tracks expectations for Fed action, fell to 4.94% from 4.97%.

In foreign stock markets, indexes fell slightly across Europe after the European Central Bank kept its main interest rate unchanged.

Stocks were mixed in Asia, where South Korea's Kospi edged up 0.1% after the ruling conservative party suffered a crushing defeat in parliamentary elections.

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AP Business writers Matt Ott and Elaine Kurtenbach contributed.