Wall Street closes down, pressured by tech losses and worries about rates
McDonald's falls after E. coli outbreak
Texas Instruments up as profit beats forecasts
Boeing falls after results; contract vote awaited
Tesla earnings expected after the bell
Updates at 4pm ET/8pm GMT
By Lisa Pauline Mattackal, Purvi Agarwal and Carolina Mandl
Oct 23 (Reuters) - Wall Street closed lower on Wednesday, as climbing Treasury yields pressured megacap stocks and investors grew less confident about strong rate cuts from the Federal Reserve, while corporate news pressured McDonald's and Coca-Cola.
Benchmark 10-year U.S. Treasury yields reached a three-month high with investors reassessing the Fed rate-cut outlook over the next few months against the backdrop of strong economic data and the upcoming presidential election.
"The market is struggling to digest this latest backup in yields," said Adam Turnquist, chief technical strategist for LPL Financial, adding higher rates are pressuring stocks.
Among rate-sensitive megacaps, Nvidia NVDA.O, Apple AAPL.O, Meta Platforms META.O and AmazonAMZN.O slid, pulling Information Technology .SPLRCT stocks lower and dragging on the tech-laden Nasdaq.
Out of the 11 S&P sub sectors, only utilities and real estate posted more noticable gains.
According to preliminary data, the S&P 500 .SPX lost 53.61 points, or 0.92%, to end at 5,797.59 points, while the Nasdaq Composite .IXIC lost 297.15 points, or 1.60%, to 18,275.98. The Dow Jones Industrial Average .DJI fell 415.29 points, or 0.97%, to 42,509.60.
McDonald'sMCD.N tumbledafter an E. coli infection linked to itsQuarter Pounder hamburgers killed one and sickened many. Coca-Cola KO.N fell after the company reiterated its annual profit growth forecast even though it expected higher revenue.
The broader consumer discretionary .SPLRCD sector also dropped.
"You have a market that had gotten up to new all time highs so portfolio managers are looking around and saying: maybe I should take some profits," said Thomas Martin, senior portfolio manager, Globalt Investments.
Boeing BA.N dropped after the planemaker reported a quarterly loss of $6 billion owing to a crippling strike. Factory workers at Boeing will vote later in the day on a new contract proposal that could end the standoff after more than five weeks.
Semiconductorcompany Texas Instruments TXN.O gained after its third-quarter profit beat forecasts, while AT&T T.N rose aftergaining more wireless subscribers than expected in the third quarter.
Tesla TSLA.O, the first of the so-called Magnificent Seven companies scheduled to report results after market close, closed down.
The benchmark S&P 500 had its third consecutive daily decline.
U.S. markets are near record-high levels, but a combination of earnings, a changing monetary policy outlook and the upcoming presidential election will test the rally and could stoke volatility, analysts said.
Richmond Fed President Thomas Barkin said the central bank's fight to return inflation to its 2% target may take longer than expected, limiting interest rate cuts.
The Fed "Beige Book" survey showed U.S. economic activity was little changed from September through early October while firms saw an uptick in hiring.
Reporting by Lisa Mattackal and Purvi Agarwal in Bengaluru; Editing by Arun Koyyur, Pooja Desai and David Gregorio
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