The Nasdaq closed lower while the S&P 500 was little changed on Wednesday as investors rotated out of technology shares and concerns about inflation added some pressure on stocks.
The Dow Jones Industrial Average rose, however, aided in part by gains in shares of Verizon Communications Inc and Chevron Corp. Those stocks gained after Warren Buffett's Berkshire Hathaway Inc disclosed major investments in the companies on Tuesday. Verizon shares climbed 5.2 percent, and Chevron shares advanced 3 percent.
Technology shares led losses on the S&P 500 and Nasdaq. Apple, PayPal Holdings and Nvidia weighed most on both indexes. The S&P 500 tech index ended 1 percent lower.
Conversely, energy rose 1.5 percent to lead gains among S&P 500 sectors as a halt in Texas oil production boosted crude prices. A strong rebound in US retail sales helped consumer discretionary stocks advance 0.7 percent.
The S&P 500 and the Nasdaq pared losses while the Dow added to gains after the release of minutes from the Federal Reserve's January policy meeting.
All of the meeting's participants supported the decision to maintain an accommodative monetary policy. The Fed has pledged to pin interest rates near zero until inflation rises to 2 percent and looks set to exceed that goal.
"The market is accurately reflecting the combination of continued low interest rates and a continued accomodative Fed," said Oliver Pursche, president of Bronson Meadows Capital Management in Fairfield, Connecticut.
Yet the Fed's accomodative stance, coupled with President Joe Biden's proposed US$1.9 trillion package for pandemic relief, has some analysts warning of a coming surge in inflation. As a result, some investors have worried that the Fed may have to change course sooner than expected.
Those fears, which have been bolstered by a sharp rise in benchmark Treasury yields, have contributed to recent market declines, with investors taking profits from market-leading technology stocks.
Inflation pressures may force the Fed to revise its policy in the future, said Michael O'Rourke, chief market strategist at JonesTrading in Stamford, Connecticut. But, he added, "It's a high threshold we have to cross in order to get them to react."
The Dow Jones Industrial Average rose 0.29 percent, to 31,613, the S&P 500 lost 0.03 percent, to 3,931 and the Nasdaq Composite dropped 0.58 percent, to 13,965.
Wells Fargo & Co shares jumped 5.2 percent after a report said the lender won Fed acceptance for its proposal to overhaul its risk management and governance.
US-listed shares of Shopify slid 3.3 percent after the Canadian e-commerce software giant hinted at slower revenue growth in 2021 as vaccine rollouts encourage people to return to stores after a year marked by an upsurge in online shopping. (Reuters)