U.S. stocks rose late on Wednesday to recoup some losses after major equity indexes fell a day earlier as worries about inflation and global economic growth fueled higher volatility among risk assets .
[Click here to read what’s moving markets on Thursday, April 28]
The S&P 500, Dow and Nasdaq rose about 1% intraday. A day earlier, the S&P 500 fell 2.8% on Tuesday for its biggest drop in seven weeks, with technology stocks particularly subdued. The Nasdaq Composite sank 4% to 12,490.74, its lowest level since December 2020. With just three trading days in April, the S&P 500 is heading for a 7-month low .8%
A tepid quarterly earnings season continued, and Big Tech companies that reported earnings after the market closed on Tuesday produced mixed results. Microsoft shares rose after the company posted sales and earnings that beat estimates, driven in part by growth in its Azure cloud computing business. Alphabet, however, saw shares fall after reporting a sharp slowdown in YouTube ad sales growth and a lack of earnings, although company-wide revenue was in line with estimates. Advertising-based tech giant Meta Platforms is set to report results on Wednesday after the market closes.
The sell-off in US stocks this week extended the volatility seen so far in April and the year to date, with investors continuing to monitor signs of higher inflation and the specter of more stress of the supply chain as China struggles with an ongoing COVID-19. 19 resurgence in key regions. And while the Federal Reserve is in a shutdown period ahead of the central bank’s May meeting next week, investors still held onto the outlook for monetary policy tightening at the forefront, with higher rates and costs of debt ready to pressure the valuations of high-growth companies. .
“The wall of worry has been building, in terms of Fed concerns,” Matt Stucky, senior portfolio manager at Northwestern Mutual Wealth Management, told Yahoo Finance Live on Tuesday. “Just over three months ago, the futures market was pricing in just three or four rate hikes in all of 2022. Now we’re well above that. And the markets are pricing in a fed funds policy rate around 2.7% at the end of the year So this is a significant amount of increased Fed tightening that has been building up over the course of the year . And it’s one of the main reasons why we’ve also seen volatility increase.”
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Given these myriad concerns, other analysts suggested that investors brace for more near-term jitters.
“There are some very discounted names, but I think there’s a little bit more discount. So you’d be cautious about entering the markets at this time,” Kathy Entwistle, managing director of Morgan Stanley Private Wealth Management, he told Yahoo Finance Live. “It’s impossible to call the bottom, so we also like to do a little bit of dollar cost at the entrance.”
“Supply chain has been a problem, we’ve had problems in China, we’ve had inflation – these are all things we know and have repeated,” he added. “But I think it’s all coming to a head right now and everybody’s at that point where it feels like there’s nowhere else to go. We know that. [Fed] eventually there will be an action and that will affect the markets.”
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4:04 PM ET: S&P 500, Dow close higher to recoup some of Tuesday’s losses; The Nasdaq was little changed
Here were the top market moves as of 4:04 PM ET:
S&P 500 (^GSPC): +8.72 (+0.21%) to 4,183.92
Dow (^DJI): +61.75 (+0.19%) to 33,301.93
Nasdaq (^IXIC): -1.81 (-0.01%) to 12,488.93
Crude (CL=F): +$0.45 (+0.44%) to $102.15 a barrel
Gold (GC=F): -$17.70 (-0.93%) to $1,886.40 per ounce
10-year treasury (^TNX): +4.6 bp for a return of 2.8180%
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1:01 pm ET: Boeing shares fall after posting bigger-than-expected loss, missing cash flow and revenue
Boeing shares fell more than 7% on the day Wednesday after the planemaker posted a bigger-than-expected quarterly loss and missed sales.
Revenue was just $13.99 billion in the first quarter, Boeing said Wednesday morning, which was less than the $15.94 billion analysts were expecting, according to Bloomberg data. Boeing’s defense business unit saw sales fall 24% from last year to just under $5.5 billion, while $6.84 billion was expected. Commercial aircraft sales were also down 2.5% from last year.
Meanwhile, operating cash flow was a negative $3.22 billion in the quarter, or a much steeper drop than the $2.61 billion expected. Core losses widened to $2.75 per share, compared to $1.53 per share in the same quarter last year.
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11:23 am ET: Pending home sales fall more than expected in March amid rising rates
Pending U.S. home sales fell for a fifth straight month in March as rising mortgage rates hurt affordability and consumers’ propensity to enter the still-hot housing market.
Contract signings nationwide fell 1.2 percent last month compared to February, the National Association of Realtors (NAR) said Wednesday in its latest report. Consensus economists were looking for a 1% drop, according to Bloomberg consensus data. And in February, pending home sales had fallen by 4%.
“The drop in contract signings implies that the multiple offers will soon dissipate and be replaced by much calmer and normalized market conditions,” said Lawrence Yun. NAR’s chief economist said in a press release. “As it stands, the sudden large gains in mortgage rates have reduced the pool of eligible homebuyers and consequently reduced buying activity.
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9:43 am ET: US trade deficit widens to record high
The The US trade deficit jumped to a record high in March, yawned much more than expected compared to February as imports jumped.
The goods trade gap hit $125.3 billion last month, Commerce Department data showed on Wednesday. That was a much wider than expected deficit of $105 billion, according to Bloomberg consensus data. In February, the trade deficit stood at $106.3 billion.
Imports rose 11.5% to $294.6 billion, which was also a record and was led by a jump in imports of industrial and energy products. Exports rose 7.2% and also hit an all-time high of $169.3 billion.
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9:33 am ET: Stocks open higher
Here’s where the stock was trading Wednesday morning:
S&P 500 (^GSPC): +20.23 (+0.48%) to 4,195.87
Dow (^DJI): +134.66 (+0.41%) up to 32,274.84
Nasdaq (^IXIC): +90.23 (+0.72%) to 12,582.47
Crude (CL=F): -$1.52 (-1.49%) to $100.18 a barrel
Gold (GC=F): -$7.40 (-0.39%) to $1,896.70 per ounce
10-year treasury (^TNX): -0.9 bp for a return of 2.792%
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7:30 am ET Wednesday: Stock futures are trading higher
Here’s where the stock was trading heading into the opening bell Wednesday morning:
S&P 500 futures (IS=F): +29 points (+0.7%) up to 4,199.5
Dow futures (YM=F): +307 points (+0.93%) up to 33,467.00
Nasdaq futures (NQ=F): +73 points (+0.56%) up to 13,089.00
Crude (CL=F): +$0.41 (+0.4%) to $102.11 a barrel
Gold (GC=F): -$5.70 (-0.30%) to $1,898.40 per ounce
10-year treasury (^TNX): -1.3 bp for a return of 2.759%
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6:10 PM ET Tuesday: Stock futures open mixed
Here’s where the stock was trading Tuesday evening:
S&P 500 futures (IS=F): -4 points (-0.1%) to 4,166.5
Dow futures (YM=F): +40 points (+0.12%) up to 33,200.00
Nasdaq futures (NQ=F): -41.50 points (-0.32%) to 12,974.50
NEW YORK, NEW YORK – MARCH 16: Traders work on the floor of the New York Stock Exchange (NYSE) on March 16, 2022 in New York City. The Dow started the day on positive ground, extending yesterday’s rally. (Photo by Spencer Platt/Getty Images)
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Emily McCormick is a reporter for Yahoo Finance. Follow her on Twitter.
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