A turbulent day on Wall Street ended in the record books Thursday as the Dow Jones Industrial Average climbed above 27,000 for the first time and the S&P 500 index hit another all-time high.
The milestones came on a day when the S&P 500 briefly moved above 3,000 for the second straight day before an early rally lost some of its momentum.
The market lost some ground after an auction of long-term U.S. government bonds failed to drum up strong demand. That pulled bond prices lower, sending yields sharply higher.
Banks and technology stocks led the broad gains, offsetting losses in real estate and communications services companies.
The latest gains extended a winning streak for stocks into its third day. Stocks have been trending higher for much of the week as investors have grown more confident that the Federal Reserve may cut interest rates for the first time in a decade as soon as the end of this month.
"Sure, 27,000 is just a number and in the whole scope of things isn't meaningful," said Ryan Detrick, senior market strategist for LPL Financial. "What it is though is a reminder for all investors that this bull market has ignored all the scary headlines for years and the dual benefit of fiscal and monetary policy could mean it has a lot longer to go than most expect."
The S&P 500 rose 6.84 points, or 0.2%, to 2,999.91. The index set three straight record highs last week.
The Dow gained 227.88 points, or 0.8%, to 27,088.08. The Nasdaq composite gave up an early gain, sliding 6.49 points, or 0.1%, to 8,196.04. The Russell 2000 index of smaller company stocks dropped 7.13 points, or 0.5%, to 1,557.92.
Major stock indexes in Europe fell.
Stocks rose from the get-go Thursday as investors looked ahead to Fed Chairman Jerome Powell testifying before a Congressional committee for the second straight day.
Powell stressed that the Fed is prepared to cut interest rates to support the economy, raising hopes that the first reduction in its key policy rate in a decade could happen later this month.
He noted that "uncertainties around trade tensions and concerns about the strength of the global economy continue to weigh on the U.S. economic outlook."
New government data released Thursday showed consumer prices rose in June from a year earlier. The bump in inflation wasn't expected to give the Fed reason to reconsider whether it should lower rates, if necessary. Inflation has remained muted through much of the economy's 10-year expansion, which Powell has said cited as a justification for potentially lowering rates.
The early rally weakened by early afternoon after bond yields spiked following weak demand at an auction for 30-year Treasurys. That pulled bond prices lower, driving the yield on the benchmark 10-year Treasury note to 2.14% from 2.06% late Wednesday, a big move.
"The markets were higher at the beginning of the day based on Powell's testimony and him confirming what the futures markets have been telling us for a whole month: That we were going to get a rate cut," said Randy Frederick, vice president of trading & derivatives at Charles Schwab. "But then we had this Treasury auction, which apparently didn't go so hot."
The surge in bond yields marked a reversal from recent weeks, when many investors funneled money into bonds and other less-risky assets amid growing anxiety over the U.S. trade conflicts and signs of a slowing global economy.
The move had a swift effect on real estate stocks, utilities and other high-dividend stocks that lose their appeal when bond yields rise. Real estate investment trusts took the heaviest losses. Iron Mountain slid 7.5%.
Banks benefited from the surge in bond yields. When bond yields climb, they push up the interest rates that lenders charge for mortgages and other loans, making them more profitable. Bank of America rose 1.2% and Goldman Sachs gained 2.6%.
Pharmaceutical makers dropped after the White House scrapped a plan to overhaul a system of rebates those companies pay to insurers and distributors. Merck & Co. dropped 4.5%.
The move gave drugstore chains and health insurers a boost, however. Cigna surged 9.2%, CVS Health gained 4.7%, UnitedHealth climbed 5.5% and Anthem rose 5.5%.
Traders also weighed a mix of corporate earnings reports, Delta Air Lines and aviation maintenance company Air notched gains after their latest quarterly results topped Wall Street's forecasts. Bed Bath & Beyond and Fastenal slumped on disappointing results.
Corporate earnings will keep investors busy starting next week, when S&P 500 companies begin reporting results for the April-June quarter.
Companies have been lowering expectations for how much profit they made in the quarter. Wall Street now projects that overall S&P 500 company earnings for the quarter fell 2.6% from a year earlier, according to FactSet. As recently as the end of March, earnings were forecast to be down only 0.5%.
This could be the first time in three years that S&P 500 companies report a back-to-back decline in overall earnings.
"The bars for earnings have been set sufficiently low to keep expectations in check," said Jamie Cox, managing partner for Harris Financial Group. "We will hear lots about the impact of tariffs, but not much else."
Benchmark crude oil fell 23 cents to settle at $60.20 a barrel. Brent crude oil, the international standard, dropped 49 cents to close at $66.52 a barrel. Wholesale gasoline fell 2 cents to $1.99 per gallon. Heating oil declined 1 cent to $1.98 per gallon. Natural gas fell 2 cents to $2.42 per 1,000 cubic feet.
Gold fell $5.80 to $1,404.30 per ounce, silver fell 8 cents to $15.07 per ounce and copper fell 1 cent to $2.68 per pound.
The dollar rose to 108.47 Japanese yen from 108.42 yen on Wednesday. The euro strengthened to $1.1258 from $1.1253.
Nike still planning Arizona shoe plant
PHOENIX (AP) — Nike announced Thursday it's going forward with plans to make soles for Nike Air shoes in a Phoenix suburb even though Arizona Gov. Doug Ducey blocked state money for the facility when the company pulled a flag-themed shoe from the market.
The shoemaker did not address the controversy in announcing its plans for a $184 million factory with at least 500 jobs in Goodyear.
Despite his earlier criticism, Ducey welcomed Nike to Arizona on Thursday.
"This is good news for Arizona and for @GoodyearAZGov," he wrote on Twitter. "500 plus jobs. Over $184 million in capital investment. Arizona is open for business, and we welcome @Nike to our state."
Nike faced criticism last week for its decision not to sell the Nike Air Max 1 USA shoe, which included a Revolutionary-era emblem known as the Betsy Ross flag.
Former NFL quarterback Colin Kaepernick, who has a high-profile endorsement deal with Nike, told the company the flag recalls an era when black people were enslaved and that it has been appropriated by white nationalist groups, a person familiar with the conversation told The Associated Press last week.
"Arizona's economy is doing just fine without Nike," Ducey wrote on Twitter. "We don't need to suck up to companies that consciously denigrate our nation's history."
He said he's "embarrassed for Nike," called its decision "a shameful retreat" and ordered the Arizona Commerce Authority to withdraw a grant of up to $1 million.
But Nike will still get more than $2 million in tax breaks from the city of Goodyear, where Nike said it will begin work on the facility later this year and begin making soles in 2020. It will be the third U.S. manufacturing center for Nike Air.
The company, based in Beaverton, Oregon, recently expanded plants in its home state and Missouri.
Twitter outage cuts of tweets
SAN FRANCISCO (AP) — "Miss us?" Twitter tweeted from its official account as the Great Twitter Outage wound down.
We did, apparently.
For nearly an hour Thursday, the service we use to keep up with everything and nothing appeared inaccessible for people around the world, regardless of celebrity status or follower count. We reloaded and reloaded. Some turned to Instagram, Facebook and even LinkedIn to express outrage over the outage.
But it was just not the same.
Then, shortly before 1 p.m. PT, it was back for many of us. Twitter posted an explanation on its status page blaming an "internal configuration change" that it was fixing.
The model Chrissy Teigen phrased the collective sigh in all caps, tweeting "OH THANK GOD." Earlier, she turned to Instagram to post what looked very much like a tweet: "TWITTER IS DOWN I DON'T KNOW WHERE ELSE TO SAY THIS AHHHHHH." How serious she was is in the eyes of the beholder.
The hashtag "TwitterDown" was trending as users recalled their experiences. Some were too young to remember a time when such an outage was a common occurrence.
Outages were so widespread in Twitter's early years that a cartoon "fail whale" the company displayed during outages came to symbolize Twitter almost as much as its little blue bird icon. The whale was retired in 2013, largely because Twitter didn't want to be associated with what it represented any more. After all, outages had become far less common.
This time, Twitter's home page read in part, "Something is technically wrong. Thanks for noticing." The disruption appeared to affect both web and mobile app users. According to Down Detector, a website that tracks outages, problems were reported from the U.S., Europe and elsewhere.
Facebook and Instagram have also experienced outages recently, during which time users turned to Twitter to joke and complain. But for the politicians, celebrities and other public figures who use Twitter as their main communications platform — and for the people who follow them — nothing quite compares with the immediate, public nature of the service.
The outage came as President Donald Trump convened a White House conference of like-minded critics of Big Tech. Tech companies such as Twitter weren't invited.
Trump says China "letting us down"
WASHINGTON (AP) — President Donald Trump on Thursday accused China of "letting us down" by not promptly buying more U.S. farm products.
"They have not been buying the agricultural products from our great Farmers that they said they would," the president said on Twitter. "Hopefully, they will start soon."
After meeting with President Xi Jinping late last month, Trump said China had agreed to buy more U.S. agricultural products as part of a cease-fire in the two countries' trade war. The truce suspended U.S. plans to impose tariffs on an additional $300 billion in Chinese goods — action that would have extended the taxes to everything China ships to America.
The United States and China are sparring over the Trump administration's allegations that Beijing is using predatory tactics — including stealing sensitive technology and forcing U.S. firms to hand over trade secrets — to try to supplant American technological supremacy.
Trump has imposed 25% tariffs on $250 billion in Chinese imports. Beijing has counterpunched by taxing $110 billion in U.S. goods, specifically targeting U.S. farm products produced by many Trump supporters in the U.S. heartland.
The administration has rolled out $27 billion in aid to farmers to ease the pain.
Trump and Xi agreed to restart negotiations that had broken down in May after 11 rounds of talks. So far, the two countries' top envoys have spoken by phone but haven't announced plans to resume face-to-face talks.
In addition to opposing sharp-elbowed Chinese tech policies, the United States wants Beijing to buy more U.S. products and to narrow America's trade deficit with China — a record $381 billion last year.
Last month, a former Chinese diplomat, Zhao Weiping, told reporters in New York that the United States was asking "us to purchase more than we can buy." He added, "You have to be realistic."
Still, Larry Kudlow, director of Trump's National Economic Council, said Thursday that "our side expects China very soon to start purchasing American agriculture commodities, crops, goods and services."