Stock market today: Wall Street tumbles back to where it was in May

4% Wednesday after rising bond yields tightened their chokehold on the stock market and some of the most influential companies turned in mixed profit reports. The Dow lost 105 points, and the tech-heavy Nasdaq composite dropped 2.4%. Google parent company Alphabet fell sharply on worries about a slowdown in growth for its cloud-computing business. Amazon, Nvidia and Apple also fell. Microsoft rose after reporting stronger profit than analysts expected. Crude oil prices jumped.

Microsoft was an outlier and rose 2.9% after reporting stronger profit and revenue for the summer than analysts expected. Its movements carry extra weight on the market because it’s the second-largest company by market value. Also putting heavy pressure on the overall stock market was a rise in Treasury yields. The 10-year yield climbed to 4.95% from 4.82% late Tuesday, which helped to send the large majority of stocks on Wall Street lower.

High yields tend to most hurt stocks seen as very expensive or those forcing their investors to wait the longest for big growth. That puts the spotlight on internet-related, technology and other high-growth stocks. Besides Alphabet, sharp drops for Apple, Nvidia and Amazon were the heaviest weights on the S&P 500.

For more than 40 years, the Fed has come to the rescue of markets and the economy whenever trouble arose by quickly cutting interest rates. That’s because high inflation was not a problem. But now, with the trend of globalization retreating and other long-term swings pushing upward on inflation, VanCronkhite said the Fed has to worry about more than just propping up the job market.

High rates and yields have already inflicted pain on the housing market, where mortgage rates have jumped to their highest levels since 2000. The Fed's hope is to restrain the economy enough to cool off inflation, but not so much that it creates a deep recession.

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