Stocks recover much of their early losses on Wall Street

The S&P 500 was virtually unchanged, as of 2:46 p.m. Eastern time, to come back from an early 1.7% loss. The Dow Jones Industrial Average was up 94 points, or 0.3%, at 33,905 after eliminating an earlier 488 point loss, and the Nasdaq composite was 0.8% higher.

Stocks have been shaky recently, with the S&P 500 coming off a three-week losing streak, amid worries about high inflation and the quick jump in interest rates the Federal Reserve is likely to prescribe for it. Strong profit reports for the first three months of the year from big U.S. companies had been offering some support, but even that was looking less solid following several mixed forecasts last week.

Now investors are in the midst of one of the most important stretches of the earnings season. Apple, Microsoft, Amazon and the parents of Facebook and Google are all on deck to report this week. And because they’re among the biggest companies by market value, their movements hold the most sway over the S&P 500.

Earlier in the morning, U.S. stocks had been on track to follow global markets lower, especially in China, over worries that strict lockdown measures there might crimp the world’s second-largest economy and potentially hurt global economic growth. Hong Kong’s Hang Seng slumped 3.7%. The Shanghai Composite fell 5.1%.

China’s capital, Beijing, began mass testing of more than 3 million people on Monday and restricted residents in one part of the city to their compounds, sparking worries of a wider lockdown similar to Shanghai. That city has been locked down for more than two weeks and that has already prompted the International Monetary Fund to trim its growth forecast for China’s economy.

Prices for ultra-safe U.S. government bonds rose as traders shied away from risk. The yield on the 10-year Treasury, which affects rates on mortgages and other consumer loans, fell to 2.82% from 2.90% late Friday.

Energy companies were among the biggest losers as U.S. crude oil prices slipped 2.9%. Exxon Mobil fell 3.4%.

Banks and industrial stocks stocks also fell. Bank of America fell 1.1% and Lockheed Martin fell 1%.

Communications stocks were leading the way. Twitter jumped 6% after the social media company agreed to be taken private by Tesla CEO Elon Musk for $54.20 a share, or about $44 billion.

Rising inflation remains a key concern for investors. Investors continue to focus on the measures being taken by central banks to rein it in. The chair of the Federal Reserve has indicated the central bank may hike short-term interest rates by double the usual amount at upcoming meetings, starting next week. The Fed has already raised its key overnight rate once, the first such increase since 2018.

Wall Street will also get some key economic data this week. The Conference Board will release its measure of consumer confidence for April on Tuesday. The Commerce Department will release its first-quarter gross domestic product report on Thursday.

It’s also a busy week for earnings reports from U.S. companies. Google’s parent company, Alphabet, and General Motors will report their results on Tuesday, along with Microsoft and Visa. Boeing, Ford and Facebook parent, Meta, are on deck to report results on Wednesday. McDonald’s, Amazon and Apple report on Thursday.