Equities slipped Wednesday for a second straight day as investors continued to shed risky assets and scale back expectations for near-term Federal Reserve rate cuts. The Dow Jones industrial average declined 0.3 percent while the S&P 500 and Nasdaq both dipped 0.6 percent. US Treasury yields and oil prices rose while the dollar declined.

Comments from a range of Fed policy-makers has fed the view that markets have gotten carried away with hopes for rate cuts. Stronger than expected retail sales figures aggravated those concerns. Bond yields rose in response, which undercut megacaps and growth stocks, which are most responsive to interest rates. Housing market sentiment figures also attracted attention as they came in better than forecasters expected, evidently as housing demand has rebounded on lower mortgage rates.

Chipmakers had a bad day to lead technology stocks lower. Other laggards included communication services, consumer discretionary, industrials, and materials. Holding up best were health care and consumer staples.

Market Reflections track market reaction to the trading day's major events. Economic data, policymaker speeches, and company news are featured in this report as well as key indexes and financial instruments.

Understanding why markets respond as they do is fundamental for an investor. Market Reflections help explain how the day's events, news, and data impact the outlook for the economy and for market prices.