Stock market today: Wall Street drifts, and oil prices tumble back to where they were in August

U.S. stocks are drifting again Tuesday as Wall Street continues to absorb the big swings that have shaken financial markets recently.

The S&P 500 was 0.1% lower and on track for a second quiet day after months of heavy losses swiveled sharply to a rally last week, its best of the year. The Dow Jones Industrial Average was down 38 points, or 0.1%, as of 9:45 a.m. Eastern time, and the Nasdaq composite was 0.1% higher.

TripAdvisor jumped 4.6% after reporting better results for the summer than analysts expected, while Emerson Electric sank 8.5% after falling short of expectations.

The majority of big companies has been topping estimates so far this earnings reporting season, but another factor has been much more influential in driving the stock market’s big swings since the summer: the bond market.

Treasury yields there were mixed Tuesday, with the 10-year yield edging back to 4.60% from 4.66% late Monday.

Earlier in the summer, a swift rise in Treasury yields sent the stock market reeling. Yields were catching up to the Federal Reserve’s main interest rate, which was above 5.25% and at its highest level since 2001 in hopes of getting high inflation under control. High rates and yields hurt stock prices, slow the economy and raise the pressure on the entire financial system.

But yields eased sharply last week after investors took comments from the Federal Reserve to indicate it may finally be done with its hikes to interest rates. Inflation has been moderating since peaking in the summer of 2022, and the recent jump in Treasury yields may be acting like a substitute for more rate hikes.

Of course, Fed Chair Jerome Powell also cautioned last week that more hikes may still come if the rise in Treasury yields does not stay “persistent.”

Another Fed official, Neel Kashkari of the Federal Reserve Bank of Minneapolis, told Fox News late Monday that he’s “a little nervous about declaring victory too soon.” He said he wants to see more data showing inflation is cooling.

Speeches by other Fed officials this week could prove to be the biggest movers of financial markets, with relatively few high-impact economic reports on the calendar. Depending on what Fed officials say, that could portend a quieter week for financial markets, which have had quick triggers.

“When narratives shift, the market response is often fast and ferocious, with the initial reaction providing the best returns,” said Jason Draho, head of asset allocation Americas at UBS Global Wealth Management.

Elsewhere on Wall Street, homebuilder D.R. Horton jumped 2.9%after reporting better results for the latest quarter than analysts expected.

Shares of WeWork were not trading after the office-sharing company filed for Chapter 11 bankruptcy protection. It’s a stunning fall for the company that had promised to upend the way people went to work around the world. After earlier being valued at $47 billion, its stock fell 98.5% this year.

In the oil market, crude prices tumbled to continue their own sharp recent swings.

A barrel of benchmark U.S. crude fell 2.7% below $80 and is back to where it was in August, before the latest Israel-Hamas war raised worries about potential disruptions to supplies.

Brent crude, the international standard, lost 2.6%, to $82.99.

Oil prices fell as worries continue about how much fuel the world’s second-largest economy will burn. China reported its exports fell 6.4% in October from a year earlier, the sixth straight monthly decline, while imports rose 3%, the first such increase in over a year. The trade surplus fell to $56.5 billion.

Stocks fell 1.6% in Hong Kong and by less than 0.1% in Shanghai, joining losses across much of the rest of Asia. Drops were more modest for stock indexes in Europe.