Tuesday, May 24, 2022

DJIA: 31,928.62, up 48.38
S&P 500: 3,941.48, down 32.27
Nasdaq: 11,264.45, down 270.82

Stocks end mostly lower on tech weakness

U.S. stocks weathered another volatile session on Tuesday as Wall Street assessed a negative earnings pre-announcement from Snap, Inc. Shares of the social media company tumbled more than 40% after its chief executive officer (CEO) warned that a deteriorating macroeconomic backdrop is denting its forward outlook, likely slowing revenue growth. The news pressured other internet-based companies that rely on digital ad revenue, with Facebook parent Meta Platforms Inc. and Google’s Alphabet Inc. falling 7.6% and 5%, respectively. The Dow reversed early losses to edge 48 points higher, while the S&P 500 slid 0.8%. The Nasdaq Composite dropped 2.4%, having now retreated 29.8% from its November 19 peak.

Six of 11 S&P 500 sectors finished in negative territory with growth and tech-related groups lagging the most. In other corporate news, Zoom Video Communications, Inc. climbed 5.6% after topping analyst profit and revenue estimates and providing upbeat forward guidance. Elsewhere, Dexcom Inc. shed 11% following news the company was in talks to acquire medical-device maker Insulet Corp.

Treasuries strengthened, with the yield on the 10-year note down 10 basis points (0.10%) to 2.76%. A slew of disappointing economic data also dented risk appetite. Flash readings from S&P Global showed growth slowing more than anticipated in both the U.S. manufacturing and services sectors in May, with the purchasing managers’ index (PMI) prints slipping to 57.5 and 53.5, respectively. Separately, an update from the Richmond Fed revealed manufacturing activity in the region eased more than expected in May to -9 from the previous 14 figure. Finally, new home sales slumped a worse-than-forecasted 16.6% in April to a two-year low.

Read more about it here.