NEW YORK (AP) 鈥� Stocks slipped on Wall Street after a report showed that sentiment is souring among U.S. consumers. The S&P 500 lost 0.2% Friday. The Dow ended barely lower and the Nasdaq gave up 0.4%. A preliminary survey said confidence in the economy among consumers is tumbling. Treasury yields rose because the data also suggested the Federal Reserve may need to keep interest rates high in order to undercut rising expectations for inflation. That in turn hurt Big Tech and other high-growth stocks, which were the heaviest weights on Wall Street. Worries are also still high about a possible default on the U.S. government鈥檚 debt.
THIS IS A BREAKING NEWS UPDATE. AP鈥檚 earlier story follows below.
NEW YORK (AP) 鈥� A seemingly listless week on Wall Street is closing on a sour note Friday as U.S. households get more worried about the economy.
The S&P 500 was 0.5% lower and on its way to a second straight losing week. The Dow Jones Industrial Average was down 133 points, or 0.4%, at 33,176 with about an hour left in trading, while the Nasdaq composite was 0.7% lower.
Despite the S&P 500 heading for a sixth straight week where it moved less than 1%, big swings have swirled underneath amid worries about a , high and the U.S. government inching toward what could be a on its debt.
It's not just Wall Street that's concerned. Sentiment among U.S. consumers is tumbling, according to a preliminary survey by the University of Michigan. That's a worry because strong spending by consumers has been one of pillars keeping an already slowing economy from sliding into a recession.
Joanne Hsu, director of the Surveys of Consumers, pointed to the looming June 1 deadline when the U.S. government could run out of cash to pay its bills unless Congress allows it to borrow more.
鈥淚f policymakers fail to resolve the debt ceiling crisis, these dismal views over the economy will exacerbate the dire economic consequences of default,鈥� she said in a statement.
President Joe Biden and congressional leaders postponed a meeting set for Friday on the debt limit crisis to next week. The delay was billed as a sign of positive exchanges as staff-level talks are expected to continue through the weekend.
One area under heavy pressure this week looking to stabilize was PacWest Bancorp鈥檚 stock. It鈥檚 been under heavy scrutiny as Wall Street hunts for the next possible U.S. bank to fail following three since March.
PacWest lost a gain from the morning to fall 2.3%. A day earlier, it slid sharply after disclosing a flight of deposits from the prior week. It's down roughly 20% for the week so far and 80% for the year.
Banks have been bending under the weight of much higher interest rates, which have caused some customers to pull deposits in search of higher yields while also dragging down prices for the investments that the banks hold.
Rates are so high because the has been hiking them at a in order to drive down inflation. Reports this week suggested inflation is continuing to moderate from its peak last year, though it remains way too high for the comfort of households and regulators.
The hope on Wall Street is that easing inflation may convince the Fed to hold off on raising rates again at its next meeting in June. That would offer some breathing room to both the economy, which has slowed under the weight of higher rates, and to financial markets, where prices began falling long ago.
One potential wild card arrived in Friday's report on consumer sentiment. It suggested U.S. households are girding for 3.2% inflation over the long run. That's higher than last month's reading of 3% and the highest level since 2011.
One worry the Fed has is that if expectations for high inflation become entrenched, it could change behaviors by shoppers and others across the economy that only worsens inflation.
Treasury yields rose in the bond market following the consumer-sentiment report. The yield on the 10-year Treasury erased an earlier dip and climbed to 3.46% from 3.39% late Thursday. It helps set rates for mortgages and other important loans.
The two-year yield, which moves more on expectations for the Fed, rose to 3.97% from 3.90%.
News Corp. rose 7.3% after it reported a milder drop in profit and revenue for the latest quarter than analysts expected.
That鈥檚 been the trend for most of this earnings reporting season. Reports have been better than feared but still weaker than a year earlier. Companies in the S&P 500 are on track to report a second straight quarter of drops in earnings per share, something that鈥檚 called an 鈥渆arnings recession.鈥�
First Solar soared 25.2% after announcing it's purchasing Evolar AB, a European company, to accelerate its development of high efficiency tandem devices and other technologies.
On the losing end of Wall Street was Gen Digital, which fell 6% despite reporting stronger profit and revenue for the latest quarter than expected.
Big Tech stocks were also weak. They and other high-growth stocks are seen as some of the hardest hit by high interest rates. Apple fell 1%, and Amazon dropped 2.1% to act as the two heaviest weights on the S&P 500 after being up in early trading.
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AP Business Writers Yuri Kageyama and Matt Ott contributed.
Stan Choe, The Associated Press
