U.S. stocks made a U-turn to end mostly higher after opening sharply lower amid ongoing trade war concerns and signs of strain in the economy.
The blue-chip Dow added 0.4% or 142 points to close at 40,669, while the broad S&P 500 was up 8 points or 0.2%, closing at 5,569. The tech-heavy Nasdaq closed the day off just 15 points, 0.1%, at 17,446.
Stocks turned lower before the opening bell, following a Commerce Department report Wednesday morning that showed gross domestic product, a measure of economic growth, shrank in the first three months of the year as imports surged ahead of expected tariffs. It was the first contraction in three years.
More: Is America's economic slip temporary? Trump, Biden allies divided after GDP: Live updates
The 10-year U.S. Treasury note was unchanged at 4.17%. The VIX, which is also known as Wall Street's "fear gauge," ended the day about 2% higher after spiking as much as 15% in the morning.
Economic news
In addition to the GDP report, private-sector hiring was lower than expected in April, according to payroll provider ADP, coming in at 62,000 jobs compared to forecasts for double that. “Unease is the word of the day,” said Dr. Nela Richardson, chief economist for the company, in a release. “It can be difficult to make hiring decisions in such an environment.”
The PCE inflation read, which is the gauge favored by the Federal Reserve, showed price gains cooling in March. Most economists expect higher inflation to result from tariffs, which would show up in later reports.
Corporate news
Earnings reports before the opening bell were mixed.
Shares of Caterpillar Inc. closed fractionally higher despite an earnings miss. The company reported lower sales and profits for the quarter compared to a year ago. But shares of Trane Technologies surged 8.4%after reporting higher revenues and earnings. Shares of eyecare company Bausch + Lomb slid nearly 16% after missing on earnings and revenue. Wingstop Inc. stock added 14.5% after an earnings beat.
Yum Brands, owner of Pizza Hut, Taco Bell, and other restaurants, saw higher revenue and earnings that just edged analyst forecasts. The stock closed 1.8% higher.
Investors are also awaiting a slew of earnings reports from Big Tech after the closing bell, including Microsoft and Meta, the parent company of Facebook.
This article originally appeared on USA TODAY: Stocks close mostly higher despite economic contraction amid trade war