Stocks are flat after tech names give up early gains

U.S. stocks churned near the flat line on Wednesday after major tech stocks gave back an early rebound.

The Nasdaq Composite and The S&P 500 were hovering near Tuesday’s closing level shortly before 10:30 a.m., while the Dow shed 84 points

Major tech shares rose at the open but lost ground as the morning progressed. Apple held on to a 1% gain, but Tesla and Amazon fell into the red. Activision Blizzard also lost some of its post-earnings pop to trade about 3.7% higher.

Outside of tech, General Motors shares climbed 2.2% in early trading after earnings blew past expectations.

On Tuesday, investors exited technology and growth stocks, pushing the Nasdaq Composite down 1.9%. Along with losses in Apple and Tesla, shares of Netflix lost 1.2%, and Microsoft dropped 1.6%. Amazon and Facebook shed 2.2% and 1.3%, respectively. Alphabet fell 1.6%.

The S&P 500 wiped out Monday’s gains, dropping 0.7%. The Dow Jones Industrial Average ended the day up about 20 points after dropping more than 300 points at one point Tuesday.

The small-cap benchmark Russell 2000 fell 1.3%. Reopening plays like airlines, casinos and cruise lines also saw selling pressure.

There are a number of possible reasons for the downward pressure, including fears about rising inflation, concerns the Federal Reserve may have to taper monetary stimulus earlier than telegraphed, and the potential for tax hikes in the months ahead.

The struggles for tech stocks come after a strong string of earnings for some of the biggest companies in the stock market failed to push the major indexes significantly higher.

“With the S&P 500 around 1% away from record highs, plenty of good news is priced into the market, so stocks look potentially vulnerable to disappointments,” UBS strategists said in a note.

U.S. equities hit lows of the day following Treasury Secretary Janet Yellen’s comments that interest rates may have to rise somewhat to keep economy from overheating. Later in the day, the former Fed Chairman tempered her comments somewhat, saying she respects the central bank’s independence and was not trying to influence decision-making there. “It’s not something I’m predicting or recommending,” Yellen told the Wall Street Journal’s CEO Council Summit in follow-up comments.

While earnings have been coming in strong for the first quarter and companies have been raising guidance, stocks are not always moving upward following good news. Investors told CNBC this could mean the positive outlook is already priced into stocks.

Private payrolls rose by 742,000 jobs in April, according to ADP. This result was below expectations of 800,000 jobs from economists surveyed by Dow Jones.

ADP did revise its March report upward by 48,000 jobs. These numbers come ahead of Friday’s closely-watched jobs report.

The IHS Markit U.S. services purchasing managers index came in at 64.7 for April, ahead of the projected reading of 63.3, according to economists surveyed by Dow Jones. The ISM non-manufacturing index came in slightly under expectations at 62.7, however. PMIs are calculated such that readings above 50 represent expansion in an economic sector.