Friday, April 29, 2022

DJIA: 32,977.21, down 939.18
S&P 500: 4,131.93, down 155.57
Nasdaq: 12,334.64, down 536.89

Stocks tumble on tech weakness; yields rise

U.S. stocks ended sharply lower on Friday as’s post-earnings tumble inspired a risk-off mood on Wall Street. The ecommerce giant notched its worst day since 2006 (-14.7%) after reporting its first quarterly loss in seven years. The tech-heavy Nasdaq Composite sank 4.2% on the day and 3.9% for the week, capping its worst monthly performance since October 2008 (-13.3%). The Dow tumbled 939 points, extending its weekly loss to 2.5% and its April drawdown to 4.9%. The S&P 500 retreated 3.6%, posting its fourth consecutive weekly decline (-3.3%) and suffering its worst monthly drop since March 2020 (-8.8%).

Treasuries weakened, with the yield on the 10-year note rising nine basis points (0.09%) to 2.92%, settling up two basis points (0.02%) for the week. Market participants priced in a more aggressive path of monetary policy tightening by the Federal Reserve (Fed) following an update showing personal spending climbing a bigger-than-expected 1.1% in March. Separately, the core PCE deflator (the Fed’s preferred proxy of inflation) jumped 5.2% year-over-year in March, coming in just below February’s 5.3% annual pace which had marked the highest print since 1983. In commodities, West Texas Intermediate crude slipped 1% to $104.26/barrel, still capping its first five-month winning streak since January 2018.

All 11 S&P 500 sectors closed in negative territory, with ten groups losing more than 2.4%. Consumer Discretionary stocks lagged with a 5.9% drawdown. In other earnings, Apple Inc. lost 3.7% as disappointing current quarter revenue guidance overshadowed an upbeat profit tally. Intel Corp. slid 6.9% after missing earnings and revenue estimates.

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