Wall Street falls, snapping 8-day streak of gains in stock markets

NEW YORK —

The U.S. stock market fell on Tuesday, snapping an eight-day streak of gains, the longest this year.

The Standard & Poor’s 500 Index fell 0.2% but is still only 1.2% below its all-time high set last month. It has rebounded from a terrifying summer decline when the index briefly fell nearly 10% below its record.

The Dow Jones Industrial Average fell 0.2%, and the Nasdaq Composite fell 0.3%.

Chipmaker Nvidia was the market’s biggest drag, down 2.1%. It’s one of the most influential stocks on Wall Street as the frenzy surrounding artificial intelligence technology has made it one of the most valuable companies on the U.S. stock market, worth about $3 trillion.

Nvidia has regained much of its summer winning streak, when its shares fell more than 20% on concerns that investors had overhyped and overpriced the stock. But the company remains shaky ahead of an earnings report due next week.

Boeing also weighed on the market, falling 4.2%.

Federal safety officials are requiring inspections of cockpit seats on Boeing 787 Dreamliners. Boeing also halted test flights of a new version of its 777 jet after discovering a damaged structural part between the engine and the rest of the plane. The new model has not yet been approved by regulators.

Palo Alto Networks helped limit losses in the market. The cybersecurity company rose 7.2%, becoming the latest major company to report stronger profit and revenue in the latest quarter than analysts expected. S&P 500 companies are on track to report their best earnings-per-share growth since the end of 2021, according to FactSet.

Lowe’s also topped analysts’ earnings forecasts in the spring, but its shares were more muted. The home improvement retailer said it faces a challenging economic environment, “particularly for homeowners,” and lowered its revenue and profit forecasts for the fiscal year. Its shares fell 1.2%.

High interest rates are weighing on the economy after the Federal Reserve raised them sharply to rein in inflation. Treasury yields fell Tuesday ahead of a speech Friday by Federal Reserve Chairman Jerome H. Powell that is likely to be the most important event of the week for financial markets.

The economic symposium in Jackson Hole, Wyoming, where Powell will speak, has been a place for big policy announcements in the past. Expectations are not as high this time, with almost everyone agreeing that the Fed will start cutting interest rates next month.

The big question is whether the economy needs the Federal Reserve just to release the brakes or an additional boost that requires deeper and faster cuts.

A surprisingly weak jobs report last month from U.S. employers raised concerns that the Federal Reserve was keeping interest rates too high for too long. But later reports on inflation, retail sales and other data helped bolster optimism.

The yield on the 10-year Treasury note fell to 3.81% from 3.87% on Monday evening.

On Wall Street, the company behind Hawaiian Airlines rose 11.3% after it said its proposed merger with parent company Alaska Airlines had cleared a major regulatory hurdle. The period for U.S. antitrust regulators to review the deal has passed.

The value of Alaska Air Group shares remained virtually unchanged.

In total, the S&P 500 fell 11.13 points to 5,597.12. The Dow Jones fell 61.56 points to 40,834.97 and the Nasdaq lost 59.83 points to 17,816.94.

In overseas stock markets, Japan’s Nikkei 225 rose 1.8%, recouping all of its previous day’s loss. Tokyo has been the scene of some of the world’s most ferocious financial market moves recently after the Bank of Japan raised interest rates there last month.

The rally caused losses in markets around the world as it forced many hedge funds to immediately abandon a popular trade in which they borrowed Japanese yen cheaply and invested it elsewhere. It included the worst day for the Japanese stock market since the Black Monday crash of 1987.

However, the Bank of Japan’s reassurances on interest rates helped calm the market, as did better-than-expected data on the US economy.

The rebound in U.S. stocks after a terrifying few weeks is another reminder of the dangers of trying to time the market. Anyone who sold their stock investments earlier this month when panic was high would have missed the S&P 500’s recent eight-day winning streak.

The market’s best and worst days tend to fall on top of each other, “often right back to back” during recessions or downturns, says Veronica Willis, global investment strategist at Wells Fargo Investment Institute.

Choe writes for the Associated Press.