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* U.S. economy contracted in Q1 amid record trade deficit
* General Mills rises as sales beat on higher prices
* Bed Bath & Beyond replaces CEO, shares tumble
* Indexes up: Dow 0.59%, S&P 0.22%, Nasdaq 0.18% (New throughout, updates prices, market activity and comments; new byline, adds NEW YORK dateline)
By Stephen Culp
NEW YORK, June 29 (Reuters) - Wall Street wavered on Wednesday as investors limped toward the finish line of a downbeat month, a dismal quarter, and the worst first-half for the S&P 500 since President Richard Nixon's first term.
The three major U.S. stock indexes were last modestly higher, after spending much of the session wobbling between red and green.
Market leaders Apple, Amazon.com and Microsoft provided the upside muscle, while economically sensitive chips small caps and transports were underperforming the broader market.
With the end of the month and the second quarter a day away, the benchmark S&P 500 has set a course for its biggest first-half percentage drop since 1970.
As for the Nasdaq, it was on its way to its worst-ever first-half performance, while the Dow appeared on track for its biggest January-June percentage drop since the financial crisis.
All three indexes are bound to post their second consecutive quarterly declines. That last time that happened was in 2015.
But where do stocks go from here?
"If you look back at those periods, going forward, one-year and two-year returns were not bad," said Paul Nolte, portfolio manager at Kingsview Asset Management in Chicago. "If you are truly a long-term investor, the analogy I would make is why buy at Tiffany prices rather than Kmart prices?
"Unfortunately, investors tend to buy at Tiffany prices and tend to get scared and sell at Kmart prices," Nolte added.
Benchmark Treasury yields have risen by over 1.606 percentage points so far in 2022, their biggest first-half jump since 1984. That explains why interest rate sensitive growth stocks have plunged over 26% year-to-date.
Federal Reserve officials in recent days have reiterated their determination to rein in inflation, setting expectations for their second consecutive 75 basis point interest rate hike in July, while expressing confidence that monetary tightening will not tip the economy into recession.
In economic news, Commerce Department data showed GDP contracted slightly more than previously stated in the first three months of the year, with consumer spending, which accounts for about 70% of the economy, contributing substantially less than originally reported.
This follows Tuesday's dire consumer confidence report, which showed consumer expectations sinking to their lowest level since March 2013.
The Dow Jones Industrial Average rose 183.54 points, or 0.59%, to 31,130.53, the S&P 500 gained 8.59 points, or 0.22%, to 3,830.14 and the Nasdaq Composite added 20.57 points, or 0.18%, to 11,202.11.
Among the 11 major sectors of the S&P 500, energy stocks were suffering the largest percentage drop, while healthcare led the gainers.
Second-quarter reporting season remains several weeks away, and 130 of the companies in the S&P 500 have pre-announced. Of those, 45 have been positive and 77 have been negative, resulting in a negative/positive ratio of 1.7 stronger than the first quarter but weaker than a year ago, according to Refinitiv data.
Packaged food company General Mills Inc jumped 6.1% after its sales beat estimates.
Bed Bath & Beyond Inc tumbled 22.2% following the retailer's announcement that it had replaced chief executive officer Mark Tritton, hoping to reverse a slump.
Declining issues outnumbered advancing ones on the NYSE by a 2.11-to-1 ratio; on Nasdaq, a 1.91-to-1 ratio favored decliners.
The S&P 500 posted 1 new 52-week highs and 36 new lows; the Nasdaq Composite recorded 9 new highs and 259 new lows. (Reporting by Stephen Culp; additional reporting by Amruta Khandekar and Shreyashi Sanyal in Bangalore; Editing by David Gregorio)