NEW YORK (AP) 鈥� Stocks closed lower on Wall Street Thursday and banks were among the biggest weights on the market following weak earnings and a warning from JPMorgan Chase. The S&P 500 fell 0.3% and the Dow Jones Industrial Average lost 0.5%. The Nasdaq ended little changed. JPMorgan Chase reported a sharp drop in earnings for its latest quarter, falling short of forecasts. CEO Jamie Dimon reaffirmed a pessimistic view for the economy. Inflation at the wholesale level climbed 11.3% in June compared with a year earlier. It follows a worrisome report on Wednesday showing prices at the consumer level remain high.
THIS IS A BREAKING NEWS UPDATE. AP鈥檚 earlier story follows below.
NEW YORK (AP) 鈥� Stocks fell broadly in afternoon trading on Wall Street Thursday and banks were among the biggest weights on the market following weak earnings and a warning from JPMorgan Chase.
The S&P 500 fell 0.4% as of 2:55 p.m. Eastern. More than 75% of companies in the benchmark index were in the red. The Dow Jones Industrial Average fell 194 points, or 0.6%, to 30,577 and the Nasdaq fell 0.1%.
Banks had some of the biggest losses and weighed heavily on the market. fell 3.7% after reporting a sharp drop in earnings for its latest quarter, falling short of forecasts. CEO Jamie Dimon stuck by his warning earlier this summer that a 鈥渉urricane鈥� is headed for the economy.
"I haven鈥檛 changed my view at all,鈥� he said in a conference call with journalists. 鈥淭he negatives I pointed out, the risks in the future, are still the same risks. They鈥檙e nearer than they were before.鈥�
Inflation and the remain key concerns for Wall Street. compared with a year earlier. It is the latest painful reminder that inflation is running hot, following a report on Wednesday that showed than a year earlier.
Pervasive inflation has been squeezing businesses and consumers for months. More importantly for Wall Street, it prompted an aggressive reversal for the Fed on its interest rate policy. The central bank is now raising rates in an effort to slow economic growth and cool inflation, but that has raised concerns that it could go too far and actually cause a recession.
Small-company stocks fell more than the broader market, in another signal that investors are worried about economic growth. The Russell 2000 fell 1.2%.
Several big technology companies rose and helped offset some of the losses elsewhere in the market. Apple rose 2%.
The yield on the 10-year Treasury, which affects , rose to 2.96% from 2.90% late Thursday. It remains lower than the two-year Treasury, which is at 3.12%. That's a relatively rare occurrence, and some investors see it as an ominous signal of a potential recession.
The Fed has already raised rates three times this year and traders are increasingly expecting a monster rate hike of a full percentage point at the central bank's next meeting in two weeks. Traders are betting on a 83% chance of a full-point hike, up from zero a month ago, according to CME Group.
Christopher Waller, a member of the Federal Reserve鈥檚 Board of Governors, said Thursday that he would be if upcoming economic data points to robust consumer spending.
鈥淲e went into this week feeling that the Fed would make a move significant enough to show it had more control" in fighting inflation, said Greg Bassuk, CEO at AXS Investments. 鈥淎 meaty Fed rate hike alone does not rule out an opportunity for a soft landing, but the window is shrinking."
Investors have grown increasingly worried as retail sales and other data point to an economy already slowing. That could make it more difficult for the Fed to make a so-called 鈥渟oft landing,鈥� where it raises rates just enough cool inflation without causing a recession.
Concerns about the Fed's rate hikes have prompted Bank of America to forecast a mild recession hitting the economy in the second half of the year and more pain for traders. The benchmark S&P 500 index has already slumped into a bear market, down 20% from its most recent high in January, and likely hasn't hit bottom yet, according to the bank.
Investors are will get a clearer picture in the coming weeks about how badly inflation is hurting companies. Several more banks are on deck to report earnings Friday, including Citigroup and Wells Fargo, along with insurer UnitedHealth Group.
Damian J. Troise, The Associated Press
