NEW YORK >> Wall Street is slumping with stock markets worldwide today as worries rise about the strength of the global economy and inflation.

The S&P 500 was 0.8% lower in afternoon trading. The Dow Jones Industrial Average was down 212 points, or 0.6%, at 32,827, as of 12:45 p.m. Eastern time, while the Nasdaq composite was 0.8% lower.

Stock markets in Asia fell even more following discouraging data on manufacturing from China. The world’s second-largest economy has not been rebounding as strongly as many investors had hoped. That raises worries when economies around the world are contending with still-high inflation and much higher interest rates than a year earlier.

Wall Street has been able to weather such concerns pretty well recently, largely because of big gains for a handful of tech companies and others getting swept up in the buzz around AI. The S&P 500 is still on track to close out a roughly flat May and may squeeze out a third straight winning month.

But some of the air seeped out of those big winners today. Nvidia, whose chips are helping to power the surge into AI, dropped 3.3% and is heading for its first fall since it gave a monster forecast last week for upcoming sales. It’s already more than doubled this year and was flirting with a total value of $1 trillion a day earlier.

Worries are also rising for the larger U.S. economy, which has begun to slow under the weight of much higher interest rates. The Federal Reserve has raised rates at a furious pace since early last year in hopes of getting inflation under control. But high rates work by hurting the economy and hitting prices for investments.

“We see this as a race for weakness between inflation and economic activity,” said Tony Roth, chief investment officer at Wilmington Trust.

Either inflation needs to break lower to return to the Fed’s target, which would allow it to take it easier on interest rates, or the economy will fall into recession. Roth said both the economy and inflation have remained strong for longer than he expected: “It’s a very slow race to the bottom.”

Many traders are bracing for the Fed to raise rates again at its next meeting in two weeks, but the hope is that may be the last for a while.

A report released this morning bolstered expectations for at least one more hike after it showed employers advertised more job openings last month than expected. It’s the latest signal of a job market that’s remained remarkably resilient in the face of higher interest rates.

While that’s good news for workers and for the economy, it also gives the Fed more leeway to keep rates high. A strong job market could keep upward pressure on workers’ wages, which Wall Street fears could keep inflation high.

“The increase in job openings is the worst news the Fed could have because that just puts more pressure on wages,” Roth said.

Other, smaller portions of the economy have shown much more pain. A report this morning suggested manufacturing in the Chicago region is contracting by much more than economists feared. It’s the latest region to report much weaker manufacturing than expected.

The U.S. banking system has also come under pressure because of the Fed. The surge in rates over the last year means customers are pulling their deposits in hopes of making more in interest at money-market funds. Higher rates have also knocked down the values for bonds and other investments banks made when rates were low.

On Friday looms the U.S. government’s comprehensive report on hiring across the economy. Economists expect it to show a slowdown in hiring and a tick higher in the unemployment rate.

Bubbling behind all these worries is a still simmering drama in Washington about a potential default on the U.S. government’s debt.

President Joe Biden and House Speaker Kevin McCarthy are trying to wrangle enough votes to pass a deal they struck over the weekend to allow the U.S. government to borrow more money. They need an approval in place before the U.S. government runs out of cash to pay its bills, which could happen as soon as Monday. If they fail, a default could cause tremendous pain for the economy and financial markets.

On Wall Street, Advance Auto Parts plunged 34.6% after it reported much weaker profit for the latest quarter than analysts expected. The retailer also said it expects pressures to continue through 2023, and it cut its full-year financial forecast and reduced its dividend.

Hewlett Packard Enterprise tumbled 6.8% after it reported weaker revenue for the latest quarter than expected. HP dropped 5% after its revenue likewise fell short of forecasts.

Profits for companies across the S&P 500 were largely better than analysts feared for the first three months of the year. But they were still down from where they were a year earlier.

In stock markets abroad, the Hang Seng tumbled 1.9% in Hong Kong, while stocks fell 0.6% in Shanghai.

Japan’s Nikkei 225 dropped 1.4%, while indexes fell 1.5% in France and 1.5% in Germany.

In the bond market, the yield on the 10-year Treasury fell to 3.66% from 3.70% late Tuesday. It helps set rates for mortgages and other important loans that influence housing and other markets.

The two-year yield, which moves more on expectations for Fed action, fell to 4.42% from 4.46%.