Technology shares led a bounce for major U.S. stock indexes midday Thursday, though stocks more sensitive to the economic cycle remained under pressure after the minutes of the Federal Reserve’s July meeting published Wednesday underlined the central bank’s preparations for pulling back on its easy-money policies, while worries persisted about the potential impact on economic growth from the spread of the coronavirus delta variant.

What are major indexes doing?

The Dow Jones Industrial Average

was down 26.76 points, or 0.1%, at 34,933.93, after falling 270 points at its session low.

The S&P 500

rose 13.99 points, or 0.3%, to 4,414.26.

The tech-heavy Nasdaq Composite

advanced 74.93 points, or 0.5%, to 14,600.84.

On Wednesday, U.S. stocks suffered their worst single session in a month. The Dow fell 382 points, the S&P 500 lost 1.1% and the Nasdaq Composite declined 0.9%.

What’s driving the market?

Global investors were rattled by the release of the Fed minutes, even though its message — that tapering of the central bank’s bond purchases will likely start this year — was well choreographed in speeches by policy makers ahead of the release. Equities and commodities slumped, while the U.S. dollar soared an eight month high and Treasury yields declined amid a flight to safety.

Need to Know: The Fed’s not boring anyone into submission after all. The dollar might be to blame.

Losses for U.S. stocks were limited, however. Tech shares found support, with the sector up 1.1% to lead the S&P 500 into positive territory Thursday afternoon.

Investors remain upbeat about improving corporate earnings, but are growing concerned about the spread of the delta variant of coronavirus and its potential impact on global economic growth at the same as the Fed is talking about tapering its bond buying program.

“While the formula provided could in principle be consistent with a taper decision in September (particularly given the strong July employment report that came after the FOMC meeting), the overall tone of the debate — including multiple references to the delta variant — seem more consistent with a more methodical approach in which the Fed provides a clear signal in September that a taper decision is coming in November. That was and remains our call,” said economists at Evercore ISI.

Also noteworthy was a U.K. study, from the University of Oxford based on real-world data, that showed diminished effectiveness from coronavirus vaccines to the delta variant. After four to five months, the study found that two doses of the vaccine from Pfizer

and BioNTech

was as effective as two Oxford-AstraZeneca


Economists at Goldman Sachs lowered their third-quarter U.S. growth forecast to 5.5% from 9%, though they raised their expectations for the next four quarters.

“The impact of the delta variant on growth and inflation is proving to be somewhat larger than we expected,” said the economists, led by David Mericle. Their revised forecast implies 2021 growth of 6% on a full-year basis versus 6.4% previously, and 2022 growth of 4.5% versus 4.4% previously.

Stocks of companies more closely tied to the economic cycle remained under pressure. The energy sector slumped more than 3% as oil futures fell for a sixth straight session. The sector is down more than 8% so far this week.

“It does seem that the case for caution is growing, whether that be the uncertainty around the timing and pace of the taper or the rising number of delta cases around the world,” said Craig Erlam, senior market analyst at Oanda, in a note.

“The findings from the Oxford study overnight showing a drop in the effectiveness of the vaccine 90 days after the second dose won’t alleviate delta concerns as it spreads rapidly across numerous countries,” he said.

Investors were also weighing further improvement in labor-market data. First-time claims for U.S. unemployment benefits fell more than expected last week to 348,000, a pandemic low. Economists had expected 365,000 initial claims.

The Philadelphia Fed said its manufacturing index fell to 19.4 in August from 21.9 a month earlier.

The Conference Board said its Leading Economic Index rose 0.9% in July, even as the delta variant surged.

Which companies are in focus?

Shares of Robinhood Markets Inc.

fell more than 7% after the online broker’s cautious outlook on the third quarter. See: Robinhood earnings show a company reliant on quieting retail traders and volatile crypto pricing

Tesla Inc.

shares were down 1.6% ahead of the electric car maker’s artificial intelligence day event later Thursday.

Shares of Macy’s Inc.

jumped 18% after the department-store chain delivered results Thursday that beat expectations, raised its guidance and announced a new share repurchase program.

Kohl’s Corp.

shares rose 6.7%, after the retailer reported earnings that beat expectations and boosted its full-year guidance.

Shares of Cisco Systems Inc.

were up 2.9%, leading Dow gainers, after the computer-networking company reported fiscal fourth-quarter results slightly above Wall Street estimates.

Nvidia Corp.

shares rose 6% after the chip maker’s earnings topped Wall Street estimates and the company addressed how supply constraints in the continuing global chip shortage were reflected in its outlook.

What are other markets doing?

The yield on the 10-year Treasury note

fell nearly 3 basis points to 1.244%. Yields fall as bond prices rise.

The ICE U.S. Dollar Index
a measure of the currency against a basket of six major rivals, rose 0.4% and traded at a nine-month high.

Oil futures were on track to extend a losing streak to six sessions, with the U.S. benchmark

down more than 3% at $63 a barrel. Gold futures

were little changed near $1,783.80 an ounce.

For equities, the selling was particularly intense in Europe, where miners dived nearly 5% to send the Stoxx Europe 600

and London’s FTSE 100

each falling 1.5%.

In Asia, Hong Kong’s Hang Seng Index

dropped 2.1%, while the Shanghai Composite

shed 0.6% and Japan’s Nikkei 225

declined 1.1%.

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