By Yasin Ebrahim
Investing.com -- The Dow closed flat Wednesday, after swinging between gains and losses as the bond market continued to sound the alarm on a recession, souring investor sentiment on stocks.
The 2-10 Treasury yield curve inverted by 83 basis points, the biggest inversion in about four decades, signaling increasing concerns about a potential recession.
“As the economy moves toward official recession in the months ahead, we believe the equity markets will start to price in the severity of the recession,” Janney Montgomery Scott said in a note.
Travel and leisure stocks were also wounded by fears about the impact of recession on the consumer. Booking Holdings (NASDAQ: BKNG ) and Expedia (NASDAQ: EXPE ) were down more than 4% and 6% respectively, while Airbnb (NASDAQ: ABNB ) fell 1%.
Energy stocks were flat, shrugging off a more than 2% slump in crude following data showing mixed U.S. petroleum data as crude stockpiles fell more than expected , but gasoline inventories surged offsetting somewhat positive news about demand as China eases COVID restrictions.
On the earnings front, investors digested mixed quarterly results.
Lowe’s (NYSE: LOW ), meanwhile, bucked the trend to rise more than 2% after reaffirming its full-year guidance and rolling out a new $15 billion stock buyback program.
In a sign of the skittish investor sentiment on risk assets, defensive corners of the market including health care and consumer staples were in favor, with the latter boosted by a surge in Campbell Soup .
In other news, Carvana (NYSE: CVNA ) slumped 43% after its largest creditors reportedly agreed to cooperate together in negotiations with the company, adding fears that bankruptcy is looming for the online car dealer.
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