Stocks pared losses after falling on concerns about the health of the economy

Brendan McDermidt/Reuters

Traders work on the floor of the New York Stock Exchange on June 3. Investors have grappled in recent weeks with data suggesting inflation continues to run hot while the economy cools.

New York

Wall Street’s wild day begins quietly.

U.S. stocks recovered some of their losses Monday afternoon on fresh data that stoked concerns about the health of the economy.

The Dow fell 213 points, or 0.6%, after falling more than 400 points earlier in the day. The S&P 500 fell 0.2% and the Nasdaq Composite added 0.2%.

The Institute for Supply Management’s manufacturing index rose to 48.7% in May from 49.2% in April. A reading below 50 indicates signs of contraction in the US manufacturing sector, while a reading above that level indicates expansion.

“Today may mark a significant turning point in the stock markets. In recent months, investors have cheered weaker-than-estimated data on expectations that the central bank could accelerate the start of policy easing. Investors are now reacting with fear to soft data,” Jose Torres, senior economist at Interactive Brokers, wrote in a note on Monday.

US Treasury yields fell on Monday. The 10-year yield fell to 4.4% as of 3 pm ET, according to TradeWeb.

Investors have been gripped in recent weeks with data suggesting inflation continues to run hot while the economy cools. That has dismissed concerns that the Federal Reserve will keep interest rates higher for longer than expected, sending stocks swinging. However, May saw all major stock indexes post their sixth winning month in seven.

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The personal consumption expenditure price index, the central bank’s preferred measure of inflation, showed on Friday. Inflation rose stubbornly in March. According to business sector data, PCE rose 0.3% on a monthly basis and 2.7% from a year earlier.

New gross domestic product data released last Thursday showed that the US economy expanded at a weaker pace earlier this year than initially reported. The Commerce Department’s second estimate of first-quarter GDP came in at a 1.3% annualized rate, down from 1.6%. Reflected in the first estimateMostly due to downward revision in consumer spending.

„I don’t think we’re going into a recession, but we’re normalizing,” said Keith Lerner, chief market strategist at Truist.

Elsewhere, the New York Stock Exchange said Monday A technical problem halted trading Some stocks and Berkshire Hathaway stock settled down 99.97%.

GameStop shares jumped 30% on Monday after a Reddit post Mail By Keith Gill, also known as „Roaring Kitty”, a screenshot of video game stocks worth almost nothing $116 million.

This is a developing story and will be updated.

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