US Stocks Off to Mixed Start Wednesday

(AP) -- U.S. stock indexes were mixed in early trading Wednesday ahead of an afternoon interest rate and economic policy update from the Federal Reserve.

The S&P 500 was down 0.2% in the early going. The benchmark index was coming off its largest loss in nearly three weeks, though it remains within 5% of the all-time high it reached in February.

Losses in financial and industrial stocks helped outweigh gains in technology, health care and other sectors. Energy stocks fell along with the price of oil. Bond yields were broadly lower.

Taubman Centers plunged 25% on news that rival Simon Property Group has walked away from an agreement to buy the mall owner. Simon Property Group fell 8%.

The Dow Jones Industrial Average dropped 156 points, or 0.6%, to 27,130. The Nasdaq composite was up 0.7%. The tech-heavy index has climbed to an all-time high two days in a row.

Wall Street has been generally rising since late March, at first on relief following emergency rescues by the Federal Reserve and Congress. More recently, investors have begun piling into companies that would benefit most from a reopening economy that's growing again.

The Fed's promise of immense, unprecedented amounts of aid helped stocks begin their rally, and investors want to see what Fed officials' reaction will be to a recent upturn in jobs numbers.

At their last meeting in late April, Fed policymakers decided to keep the central bank's benchmark interest rate near zero for the foreseeable future. The Fed also pledged to use its "full range of tools" to continue supporting the U.S. economy through the economic fallout from the coronavirus pandemic.

Fed Chair Jerome Powell is expected to say in a news conference that the U.S. economy remains in need of extraordinary help despite recent despite glimmers of a possible recovery, including a government report showing that employers added rather than slashed jobs in May.

Bond yields fell. The yield on the 10-year Treasury yield slid to 0.80% from 0.82% late Tuesday. It tends to move with investors' expectations of the economy and inflation, though it's still well above the 0.64% level where it started last week.

Oil prices fell. Benchmark U.S. crude oil for July delivery dropped 2% to $38.16 a barrel. Brent crude oil for August delivery was down 1.8% to $40.45.

Skeptics have been saying for weeks that Wall Street's huge rally, which reached 44.5% between late March and Monday, may have been overdone, given uncertainties over how quickly economies can recover from the pandemic when the numbers of infections and fatalities are still rising in many countries.

Apart from unabated numbers of infections in some U.S. states, experts worry surging numbers of coronavirus cases in developing regions with shaky health systems could undermine efforts to halt the pandemic.

India, Pakistan, Brazil, Mexico and South Africa are among the countries easing lockdown restrictions before their outbreaks have peaked and without detailed surveillance and testing systems in place.

European indexes were broadly lower. Germany's DAX lost 0.5%. France's CAC 40 slid 0.5% and the FTSE 100 in London was flat. Asian markets ended mixed.

The pullback came as the Organization for Economic Cooperation and Development said the coronavirus crisis has triggered the worst global recession in nearly a century and projected that the global economy will shrink by 6% this year in a best-case scenario, with only a modest pick-up next year.

The estimate, which is based on an analysis of the latest global economic data, suggests an even sharper decline of 7.6% if there is a second wave of coronavirus contagions this year.