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NEW YORK — Stocks ended slightly lower on Wall Street as a two-day rally ran out of gas. The S&P 500 ended down 0.2% on Wednesday after briefly stepping into the green late in the day. Its start to a rally this week was the biggest since the spring of 2020, spurred in part by hopes that a slowing economy could convince central banks to slow interest rate hikes. Analysts said such hopes may be premature. Other major US indexes, including the Dow Jones Industrial Average and the Nasdaq, also lost ground. Oil prices rose after the OPEC+ cartel ordered production cuts.

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THIS IS A BREAKING NEWS UPDATE. AP’s previous story follows below.

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Stocks edged higher on Wall Street on Wednesday afternoon, erasing an early drop and putting the market on track to add to its big gains this week.

A late surge in buying pushed the major indices into the green. The S&P 500 was up 0.4% at 3:19 p.m. EST, after falling 1.8% at the start. The benchmark just had its best two-day rally since the spring of 2020.

The Dow Jones Industrial Average rose 119 points, or 0.4%, to 30,436 and the Nasdaq added 0.2%.

The broader market is still battered by its September stumble, but investors were hoping signs of a slowing economy would convince central banks to temper aggressive interest rate hikes.

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Wall Street is also gearing up for the next round of corporate earnings reports to better understand how the highest inflation in four decades is squeezing businesses and consumers.

Technology and healthcare stocks helped boost the market. Oracle rose 1.7%, Exxon Mobil gained 4.7% and AbbVie rose 1.3%.

Losses in banks, utilities and other sectors limited market gains. Bank of America fell 1.4% and Duke Energy 2.4%.

Small company stocks fell, sending the Russell 2000 Index down 0.7%.

Treasury yields rose and put further pressure on stocks after several days of relief. The 10-year Treasury yield, which helps set rates for mortgages and many other types of loans, jumped to 3.76% from 3.61% on Tuesday night.

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The two-year Treasury yield, which more closely tracks expectations for Federal Reserve action, rose to 4.13% from 4.10% late Monday.

Energy stocks gained ground as US crude oil prices rose 1.4%. The OPEC+ cartel of oil-exporting countries has decided to cut production sharply to support lower oil prices. Exxon Mobil rose 4.8%.

Higher energy prices, particularly gasoline, were a major contributor to the surge in inflation earlier in the year. Stubbornly high inflation, despite falling energy costs in recent months, remains a major concern for Wall Street. The Fed and other central banks have raised interest rates to make borrowing harder and slow economic growth, but Wall Street fears the potential solution to high inflation could be a recession.

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Investors are looking for signs that the economy is slowing enough to give central banks reason to ease rate hikes. Some signs this week included a more moderate rate hike by Australia’s central bank and a US report showing job vacancies fell in August.

“We’ve heard of companies that, despite not laying off workers, are reducing the number of jobs available,” said Sam Stovall, chief investment strategist at CFRA. “So higher rates and higher inflation definitely have an effect on hiring.”

Employment has been a particularly dynamic area of ​​the economy and any sign of cooling in the hot labor market could mean inflation could follow. Analysts said such hopes may be premature. A report on US job growth among private employers came out stronger than expected on Wednesday, as did a report on the services sector.

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Wall Street will get a more detailed look at US employment on Friday with the government’s monthly jobs report for September.

Stocks are “in the middle of a tug of war between reality and expectations,” said Terry Sandven, chief equity strategist at US Bank Wealth Management.

The reality is that inflation remains elevated as markets expect it to have peaked and the Fed will ease rate hikes, he said. Trading is likely to remain volatile due to these dynamics and other uncertainties hanging over the market.

“We need time for the pace of inflation to show it’s under control,” he said.

The Fed has said it is determined to keep raising interest rates until it is satisfied that inflation is under control. This resolution has been echoed by some central banks around the world.

New Zealand’s central bank raised its benchmark interest rate to 3.5%, saying inflation remained too high, at 7.3% recently, and labor was scarce. The half-point rate hike was the fifth in a row by the Reserve Bank of New Zealand since February.

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Yuri Kageyama contributed to this report.

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