Wall Street slumps for second day Stock market today: Wall Street slumps as its weak start to 2024 carries into another day

NEW YORK - Stocks fell again Wednesday as Wall Street's slow start to the year stretched into a second day.

The S&P 500 lost 38.02, or 0.8%, to 4,704.81, though it remains within 2% of its record set exactly two years ago. The Dow Jones Industrial Average dropped 284.85 points, or 0.8%, from its own record to 37,430.19. The Nasdaq composite led the market lower with a drop of 173.73, or 1.2%, to 14,592.21.

Some of last year's biggest winners again gave back some of their gains to weigh on the market. Tesla fell 4% after more than doubling last year, for example. It and the other six "Magnificent 7" Big Tech stocks responsible for the majority of Wall Street's returns last year have regressed some following their tremendous runs.

The question hanging over the market is whether all the enthusiasm that sent stocks broadly rallying for nine straight weeks into the start of this year was warranted. It was built on expectations that inflation has cooled enough for the Federal Reserve to not only halt its hikes to interest rates but to cut them several times this year. Hopes are also high the economy can escape a recession, even after the Fed hiked its main interest rate to the highest level since 2001.

A couple of reports released Wednesday morning indicated the overall economy may indeed be slowing from its strong growth last summer, which the Federal Reserve hopes will keep a lid on inflation. A big danger is if it slows too much and begins shrinking.

One report showed U.S. employers were advertising nearly 8.8 million job openings at the end of November, down slightly from the month before and the lowest number since early 2021.

A second report from the Institute for Supply Management showed the U.S. manufacturing industry is improving by a touch more than economists expected, but it's still contracting.

Treasury yields slumped immediately after the reports and then yo-yoed though the day. The yield on the 10-year Treasury eventually slipped to 3.91% from 3.94% late Tuesday. It's been generally falling since topping 5% in October.

In the afternoon, yields swung again after the Federal Reserve released the minutes from its latest policy meeting. It was at that meeting in December that policy makers hinted their dramatic campaign to hike interest rates to get inflation under control may be over. They also released projections showing their median official expects the federal funds rate to fall by 0.75 percentage points through 2024.

Fed officials also noted in their meeting how stock prices have rallied recently and Treasury yields have eased.