Posted on 05/09/2022 10:09:08 AM PDT by Red Badger
Dow set to fall at open as markets come off another volatile week Stocks fell sharply Monday, pushing the S&P 500 to a fresh 52-week low, as the market sell-off continued and traders struggled to find their footing from last week’s big market swings.
The Dow Jones Industrial Average dropped 460 points, or 1.4%. The S&P 500 fell 2.4%, while the Nasdaq Composite lost 3.2%.
The S&P 500 traded as low as 4,003.17 on the day, as all sectors except for consumer staples dipped into the red. Amid the losses, the benchmark 10-year Treasury note yield hit its highest level since late 2018, trading well above 3%.
“This is significant repricing, this is significant dislocation and this is all being spurred and driven by Federal Reserve policy,” said Jeff Kilburg of Sanctuary Wealth. “The only way I see us finding the bottom in equities short-term, the only way I see markets healing is if the Fed has the ability with the tools in their toolbox to calm down interest rates. The 10-year note needs to go back under 3%.”
Rising rates continued to crush technology names such as Meta Platforms and Alphabet, which fell more than 4.3% and 1.7%, respectively. Amazon, Apple and Netflix all fell nearly 3%, while Tesla and Nvidia dipped more than 6%.
The combination of high rates and a potential recession as inflation surges also hit other areas of the market. Consumer stocks like Nike suffered along with industrials such as Caterpillar and Deere. Bank stocks also came under pressure with Bank of America falling more than 3%.
Boeing marked the biggest loser in the Dow, plunging more than 7% followed by energy bellwether Chevron which slipped 5.5% as U.S. oil futures continued to slide. Amgen, Walmart, Home Depot and 3M remained bright spots in the market, posting gains despite the broader sell-off.
“We expect markets to remain volatile, with risks skewed to the downside as stagflation risks continue to increase,” wrote Barclays’ Maneesh Deshpande. “While we cannot discount sharp bear market rallies, we think upside is limited.”
Wall Street is coming off a wild week, as investors weighed the prospects of rising interest rates against the potential of slower economic growth.
Last week, the Nasdaq Composite lost 1.54%, while the S&P 500 and Dow dropped 0.21% and 0.24%, respectively. It was the sixth straight losing week for the Dow, and the fifth straight for the other two major indexes.
While the cumulative moves for the week were not out of the ordinary, some of the day-to-day swings were eye-popping. The Dow had its best day since 2020 on Wednesday, but then erased all those gains and more on Thursday.
The short-lived Wednesday rally came after Federal Reserve Chair Jerome Powell said the central bank was not considering a 75-basis-point rate hike at upcoming meetings. Stocks rallied and bond yields fell following that comment but reversed course on Thursday.
Billionaire hedge fund manager David Tepper told CNBC’s Scott Wapner on Friday that Powell’s statement was an “unforced error” that contributed to market volatility.
“Our thinking is that stocks are likely to continue lower because we have not yet seen enough technical evidence to suggest a bottom process has started,” wrote JC O’Hara of MKM Partners. “Technical indicators are not oversold enough. The volume profile has shown little if any signs of real capitulation.”
On the earnings front, Palantir cratered 21% on weak revenue guidance and BioNTech gained 5.8% following a strong quarter. First-quarter earnings season is slowing down, but there are several notable reports including Walt Disney and Occidental Petroleum slated for later in the week.
In other corporate news, Rivian shares plunged nearly 15% after CNBC’s David Faber reported on Saturday that Ford is looking to sell 8 million shares in the electric vehicle maker.
When Brandon destroys the economy, it’s no wonder markets crash.
Yes. We’re paying for the stolen election over and over again. Everyday is another chapter in this ongoing nightmare.
I was at the gas pump the other day and a Hispanic lady dressed to the nines drove up in a brand new big truck ($60,000 - 70,000) and didn’t know how to pump gas and asked me to show her how. Yeah, I filled it up for her without thinking. (That’s how I was raised). But looking back, I thought it was very odd that she had so much money but was lacking in basic skills.
My retirement was set at $100 per share and when it went to $148 I quit. It went to $162 then the 4 to 11 interest rate hikes talk for 2022 came about. The stock and many other stocks nosedived since Dec 2021. My stock was at $120 as recently as end of March.
Now at $86.36
The company had a great quarter reported last Tuesday and was up to $99 last Wednesday and should have continued up but the democrats are in the way of the economy. They want it to tank. They do not care one iota about people losing their savings and homes etc.
The republicans should take both Senate and House but we have rinos that are on the take and may be successful in blocking a recovery.
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