Wall Street is weakening Wednesday on worries about corporate profits following a mixed set of earnings reports and forecasts from Microsoft and others.
The S&P 500 was 1.4% lower in early trading, on pace for a second step down after reaching its highest level in seven weeks on Monday. The Dow Jones Industrial Average was down 314 points, or 0.9%, at 33,423, as of 9:55 a.m. Eastern time, and the Nasdaq composite was 2.1% lower.
Worries are rising that corporate profits are set to shrink broadly because of a slowing economy and still-rising costs amid high inflation. Analysts are forecasting S&P 500 companies over the next couple weeks will report their first drop in quarterly earnings per share since the pandemic was crushing the economy in 2020.
Many investors expect inflation to keep cooling, and they're betting on the Fed to actually begin cutting interest rates toward the end of this year. The Federal Reserve, meanwhile, has been adamant that it won't, and wants to keep rates high to ensure high inflation is truly stamped out.
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