U.S. Stocks Close Weak Despite Coming Off Day’s Lows

Despite staging a fairly strong recovery from an early setback, U.S. stocks ended notably lower on Wednesday, as worries about inflation and the bitcoin’s sharp plunge weighed on the market.

The minutes from the Federal Reserve’s April meeting that showed some of the members were in favor of tapering the bank’s asset buying program if the economy continues to show signs of recovery and inflation keeps trending higher weighed as well.

Technology stocks, including Tesla, which have big exposure to bitcoin, tumbled on selling pressure. Bitcoin, the world’s largest cryptocurrency, tanked by close to 40% from its record high levels to US $31,000 on Wednesday, hitting its lowest level since February.

But the market recovered after the bitcoin rebounded from the session’s lows.

The Dow, which plunged more than 580 points to 33,473.80, recovered to close at 33,896.04 with a loss of 164.62 points or 0.48 percent. The S&P 500 finished with a loss of 12.15 points or 0.29 percent at 4,115.68, off the session’s low of 4,061.41, while the Nasdaq settled with a small loss of 3.90 points or 0.03 percent at 13,299.74, way off the day’s low of 13,072.23.

Cisco Systems plunged more than 7 percent. Chevron shed about 3 percent, while Amgen, Caterpillar, Goldman Sachs, Boeing, DuPont and IBM lost 1 to 2 percent.

Shares of Analog Devices Inc rose sharply, riding on better-than-expected first-quarter results. Microsoft and Apple recovered well and settled way up from the day’s lows.

Target Corp. (TGT) shares gained more than 6 percent after the company reported a profit of $2.09 billion, or $4.17 per share, compared with $329 million, or $0.56 per share in the year-ago quarter. Analysts had expected the company to earn $2.25 per share, according to figures compiled by Thomson Reuters.

Shares of Vipshop Holdings Ltd. (VIPS) plummeted more than 11 percent after the online retailer reported its first-quarter results and issued a revenue outlook for second quarter. Vipshop reported net income of $235.9 million or $0.33 per share. Adjusted income was $261.4 million or $1.84 per share last year.

In overseas trading, the major European markets ended sharply lower today, as fears about inflation and a plunge in cryptocurrencies triggered a sell-off in various sectors.

Asian markets ended lower on Wednesday as inflation worries persisted and investors awaited the Fed meeting minutes to figure out officials’ view on the economic recovery and inflation. Tensions between Beijing and Washington, and rising worries about the spikes in coronavirus cases in Japan hurt as well.