Stocks Drop Lower on Wall Street, Pulled Down by Big Tech

Shares fell during afternoon trading on Wall Street Friday, pulling major indices from record highs as investors watch the latest round of corporate earnings.

The S&P 500 fell 0.1% as of 11:46 am Eastern. The Dow Jones Industrial Average rose 21 points, or 0.1%, to 35,753 and the Nasdaq fell 0.2%. The indices remain on track to deliver weekly gains.

In the benchmark S&P 500 index, there were more fallers than risers. Technology stocks and a mix of companies dependent on consumer spending were the largest weight in the index. Those losses offset gains in communications services and healthcare stocks.

Bond yields rose. The 10-year Treasury yield rose to 1.57% from 1.56% at the end of Thursday.

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The latest streak of corporate earnings raised concerns that an ongoing shortage of supply chains could hamper economic growth for the rest of the year. A large number of companies have warned that they will face increased costs and struggle to meet rising demand for products.

Apple fell 2.8% after the iPhone maker’s fourth-quarter revenue lagged analysts’ forecasts as the supply shortage makes it difficult to meet demand. Internet retail giant Amazon lost 2.8% after higher costs and supply chain issues worsened third-quarter financial results and revenue forecast.

The warnings from Apple and Amazon raise concerns that the economic recovery may take a bumpier road during the holiday shopping season as people pay more for products and wait longer to receive everything from everyday purchases to gifts.

The latest data from the Department of Commerce shows that consumer spending rose just 0.6% in September, a warning sign of an economy still in the throes of a pandemic and a prolonged period of high inflation.

Investors close out a busy week of gains with several major companies reporting mixed results. Starbucks was down 7.2% after a solid fourth-quarter fiscal profit, but weak sales. US Steel rose 13.7% after the steelmaker reported strong third-quarter financial results and increased its dividend.

In addition to the profit, European and Asian leaders of the Group of 20 large and fast-growing economies meet in Rome. Wall Street is also looking ahead to next week’s meeting of the Federal Reserve as that central bank moves closer to phasing out the bond purchases that have helped keep interest rates low.