NEW YORK (AP) -- Stocks were slightly lower Wednesday, a day after the S&P 500 snapped a seven-day winning streak. Investors are watching the bond market, where yields have tumbled sharply in the last couple of days despite strong economic data.
The S&P 500 index was down 0.1% as of 10:35 a.m. Eastern. The Dow Jones Industrial Average fell 0.3%, and the Nasdaq Composite slipped 0.1%.
Bond yields were quickly moving lower, an unusual occurrence given there's been no economic data to imply an economic slowdown or deflation. In fact, the data for several weeks has shown the opposite --- an economic growing quickly out of the pandemic, and inflation tied to demand for raw materials and workers.
The benchmark 10-year Treasury note was trading at 1.29%, down from 1.37% the day before. A month ago, the 10-year note was trading at around 1.62%. The last time bond yields moved lower so quickly was in March 2020 when the pandemic effectively shut down the U.S. economy.
Lower bond yields can be good for many parts of the economy, however. Mortgage rates are tied closely to bond yields, and government borrowing costs fall when the cost of issuing bonds decreases.
Stocks that are heavily influenced by interest rates, particularly banks, were among the hardest hit on Wednesday. The KBW Bank Index of the 24 largest banks in the country was down 0.5%. Bank of America, Citigroup, Goldman Sachs were all down roughly 1%.
Investors will get minutes from the Federal Reserve's June meeting at 2 p.m. Eastern. Wall Street will be looking for additional clues about the Fed's thinking on interest rates and inflation. After the last meeting, Fed policymakers said they planned to raise interest rates as soon as 2023, which was sooner than the market expected.