Stocks drift on Wall Street as oil prices swing

NEW YORK (AP) — U.S. stocks are drifting Wednesday following strong profit reports from BlackRock and other big companies and an update on the path of inflation.

The S&P 500 was mostly unchanged. Stocks were nearly evenly split between gainers and losers in the index. The Dow Jones Industrial Average was up 43 points, or 0.1%, as of 1:05 p.m. Eastern time, and the Nasdaq composite rose 0.1%.

BlackRock surged 7.2% after the company behind some of the most popular investment funds reported stronger profit and revenue for the latest quarter than analysts expected. CEO Laurence Fink said its iShares funds topped $6 trillion in assets under management during the quarter, roughly doubling in three years.

Bank of New York Mellon rose 2.9% after adding to the spate of strong earnings reports from many of the biggest U.S. banks a day earlier. Cintas climbed 4.4% after the provider of office uniforms, restroom supplies and other products likewise delivered a better profit for the latest quarter than analysts forecast.

They helped offset a drop for Elevance Health, which fell 8.3% even though it reported stronger profit and revenue than analysts expected.

Several big technology companies fell sharply, weighing down the market and offsetting gains elsewhere. Nvidia fell 2.2% and Micron Technology slumped 9.3%.

Expectations are high for U.S. companies’ profit growth during the spring. They’ll need to beat them to justify the big moves their stock prices have made, with indexes near their records.

Another report showed inflation slowed last month. This one said inflation at the wholesale level slowed to 5.5% from 6% in May, and it was much better than the acceleration that economists expected.

The day before, a separate report said that inflation that U.S. consumers are feeling was also not as bad as economists expected last month.

Such numbers take pressure off the Federal Reserve, which is considering raising interest rates. Higher rates would keep a lid on inflation, but they also slow the economy and hurt prices for all kinds of investments.

Following the inflation report, traders see just a 12% chance that the Fed will raise its main interest rate at its next meeting in a couple weeks. That’s down from the nearly 42% probability they saw on Monday, before the inflation reports, according to data from CME Group.

Also helping to pull down expectations was a speech from John Williams, president of the New York Fed. He said that “there are encouraging reasons to expect that inflation has peaked and should edge down in coming quarters.”

That helped send the yield on the 10-year Treasury down to 4.55% from 4.58% late Tuesday and from 4.62% the day before.

Still, upward pressure on inflation remains because of the war with Iran, which has seen days of back-and-forth strikes by the United States and Iran across the Middle East.

Iran’s Revolutionary Guard threatened Wednesday to halt all energy exports from the Middle East because of the U.S. military's blockade to prevent tankers carrying Iranian oil from using the Strait of Hormuz.

“The export of oil and gas from the region will be either for everyone or for no one,” the Revolutionary Guard said.

Oil prices swung near their highest levels in a month because of the war with Iran. The price for a barrel of Brent crude briefly topped $86 in the morning before falling back to $84.93 per barrel, up 0.2% from the day before.

In stock markets abroad, technology stocks helped lead the way as winners of the artificial-intelligence boom gathered more strength following several shaky weeks.

In Asia, South Korea’s Kospi index jumped 6.2%. Its market is dominated by two huge tech companies, Samsung Electronics and SK Hynix, and the index has already had drops of 8.9%, 7.9% and 5.3% so far this month.

In Amsterdam, ASML reported stronger revenue growth for the latest quarter than the bellwether of the chipmaking industry had forecast. CEO Christophe Fouquet said continuing progress in the AI boom has customers accelerating their expansions, and the maker of chipmaking machinery gave a forecast for revenue growth in the summer that topped analysts’ expectations.

The strength helped calm some of the worries that have sent AI-related stocks spinning recently. Chief among them is the possibility that their prices shot too high in the euphoria around AI. Worries have been rising that surging demand for AI chips and data centers may fizzle if they don’t produce enough profits and productivity to make all the investments worth it.

In China, stocks rose 1.4% in Hong Kong but fell 0.3% in Shanghai after the government said the world's second-largest economy expanded at a 4.3% annualized pace last quarter, down from the 5% growth rate at the start of the year.

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