Stocks weakened Thursday as bond yields jumped after first-quarter growth figures showed an uptick in core inflation and slower than expected growth. The Dow Jones industrial average lost 1.0 percent, the S&P 500 dipped 0.5 percent, and the Nasdaq lost 0.6 percent. Oil prices and the dollar rose.

News that core personal consumption expenditures prices rose by 3.7 percent in the first quarter, above the expected 3.4 percent, spooked the bond market and aggravated worries that persistent inflation will mean no rate cuts at all this year. The figures spurred renewed talk of stagflation, not a positive scenario for stocks. On the positive side, a well-received US Treasury 7-year note sale helped yields recede in the afternoon, which helped the major stock averages recover from morning lows. Earnings news remains in focus with Alphabet, Microsoft, T-Mobile, Intel, and Capital One due to report after the close.

Among the day's losers, megacaps suffered with Meta off 11 percent after the market disliked the firm's revenue guidance and heavy investment plans, despite an earnings beat. Among sectors, worst performers included communications services, financials, consumer discretionary and real estate. Holding up best were energy, information technology, materials, and utilities.

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.