Wall Street Drifts Ahead of a Big Week 08/24 09:39

   U.S. stocks are drifting Monday ahead of a week packed with potentially 
market-moving events. The areas of the bond market that the U.S. Treasury 
Department is trying to calm down, meanwhile, eased a bit.

   NEW YORK (AP) -- U.S. stocks are drifting Monday ahead of a week packed with 
potentially market-moving events. The areas of the bond market that the U.S. 
Treasury Department is trying to calm down, meanwhile, eased a bit.

   The S&P 500 slipped 0.3% and pulled a bit further from its all-time high set 
earlier this month. The Dow Jones Industrial Average was up 49 points, or 0.1%, 
as of 9:35 a.m. Eastern time, and the Nasdaq composite was 0.6% lower.

   Tech stocks led the way downward following big swings through the summer on 
worries that the frenzy around artificial-intelligence technology sent prices 
too high and that the huge demand for AI chips won't be sustainable if they 
don't produce enough profits.

   Chip giant Nvidia has been a tremendous winner of the AI boom and become 
Wall Street's largest and most influential stock because of it. It will deliver 
its latest quarterly earnings report on Wednesday, which could dictate the next 
big move for AI-related stocks.

   Nvidia slipped 0.7% and was one of the heaviest weights on the S&P 500, 
where the majority of stocks were rising. Drops of 5.5% for Micron Technology 
and 1.5% for Broadcom also helped drag the index lower.

   The other big factor moving stocks recently has been the bond market, where 
longer-term Treasury yields climbed through the summer on worries about high 
inflation, huge government debts and other factors. High yields make it more 
expensive for everyone to borrow, not just the government, and have already 
been pushing up mortgage rates and hurting the housing industry.

   The U.S. Treasury Department announced a surprise move last week to increase 
the size of planned buybacks of Treasurys, which could help ease the rise in 
yields for 10- and 30-year Treasurys. But analysts warned the move could have 
only a limited effect because of how small the size of the buybacks are and how 
they do not fix the fundamental problems of too-high debt for the U.S. 
government and expensive oil prices because of the war with Iran.

   On Monday, the yield of the 10-year Treasury eased to 4.70% from 4.74% late 
Friday and is back below where it was late Tuesday, before the U.S. Treasury 
Department made its surprise announcement.

   Analysts warn the U.S. government's attempts to push longer-term yields 
downward could ultimately mean higher pressure on inflation. Inflation already 
is higher than nearly everyone would like and has been for years.

   That raises the pressure on the Federal Reserve to raise the federal funds 
rate that it controls, which affects very short-term overnight loans. When the 
Fed raises that rate, it can help keep a lid on inflation by trying to slow the 
overall economy and undercutting prices for stocks and other investments.

   The Fed's new chairman, Kevin Warsh, is set to deliver a speech on Friday at 
an economic symposium in Jackson Hole, Wyoming. The mountain setting has 
provided the backdrop for major Fed policy announcements in the past, but 
investors are unsure of what they may get from Warsh this time around.

   Warsh has insisted that he wants to give financial markets fewer clues about 
what the Fed will do with interest rates, hoping that markets react more to 
incoming data about the economy and inflation than to what the Fed is signaling.

   Helping to curb some of the worries on inflation Monday was a drop in oil 
prices. Brent crude fell 1.3% to $91.51 per barrel.

   Last month it zigzagged between $72 and $102 as hopes rose and fell that the 
United States and Iran could reach a deal that would allow oil tankers to 
freely exit the Persian Gulf again.

   In stock markets abroad, indexes dipped around much of the world. South 
Korea's Kospi fell 3.1%, and Hong Kong's Hang Seng dropped 1.9% for two of the 
biggest moves.

   Seoul has been home to some of the world's sharpest swings this summer 
because it is dominated by two tech titans benefiting from the AI boom, Samsung 
Electronics and SK Hynix.