ReportWire

Tag: Dow Jones Industrial Average

  • U.S. stocks close sharply higher in year-end rally after jobless claims data deemed ‘welcome news for the Fed’

    U.S. stocks close sharply higher in year-end rally after jobless claims data deemed ‘welcome news for the Fed’

    [ad_1]

    U.S. stock indexes finished sharply higher on Thursday, the second-to-last trading session of the year, with the Nasdaq Composite jumping 2.6%, erasing losses from earlier in the week.

    The three main indexes built on premarket gains after U.S. weekly jobless claims data showed the number of workers receiving benefits has climbed to the highest level since February, a tentative sign that the Federal Reserve’s interest-rate hikes might be slowing economic growth and inflation.

    How stocks traded
    • The S&P 500
      SPX,
      +1.75%
      rose 66.06 points, or 1.8%, to end at 3,849.28.

    • Dow Jones Industrial Average
      DJIA,
      +1.05%
      added 345.09 points, or 1.1%, finishing at 33,220.80.

    • Nasdaq Composite
      COMP,
      +2.59%
      climbed 264.80 points, or 2.6%, to finish at 10,478.09.

    On Wednesday, the Nasdaq Composite dropped 1.4% to 10,213, its lowest closing level of the year. The S&P 500 is up more than 6% from its 2022 low from mid-October, but the large-cap index remains down 19.2% year-to-date, FactSet data show.

    What drove markets

    The penultimate session of 2022 showed tentative signs of delivering some much needed festive cheer for the stock market as a hope for “Santa Claus rally” had earlier failed to materialize.

    MarketWatch Live: Is that you, Santa Claus?

    Stocks advanced on Thursday as data showed the number of Americans receiving more than a single week of unemployment benefits had climbed by 41,000 last week to 1.71 million, the highest level in 10 months.

    The jobless-claims data “points to a loosening in the labor market, which is welcome news for the Fed,” said Larry Adam, chief investment officer at Raymond James, in a tweet.

    However, analysts at Citi still think the claims data indicates a still-very-tight labor markets compared to historical levels.

    “While both initial and continuing claims increased this week, they remain within the levels of late 2019,” wrote Gisela Hoxha, U.S. economics research analyst at Citi. “Anecdotes of company layoffs have increased in recent months, particularly in the tech sector. While it could be hard to disentangle the seasonal effects from the announced layoffs, in our view there is no significant evidence of them showing up in the claims data yet.”

    Some of those layoffs could be taking effect a couple months later as employees might be kept on payroll for some time after the announcement, which will become significant signs of weakness in the labor market in 2023, Hoxha added.

    See: Did 2022 break Wall Street’s ‘fear gauge’? Why the VIX no longer reflects the sorry state of the stock market

    Stocks were on track to finish what’s set to be the worst year since 2008 not far from 2022 lows. The S&P 500’s 52-week closing low at 3,577.03 was hit on Oct. 12.

    Still, the three indexes managed to erase losses from earlier in the week on Thursday. Nasdaq Composite was down 0.2% this week, while the S&P 500 gained 0.1% and the Dow was nearly flat as of Thursday’s close. If the S&P 500 can hold on to weekly gains through Friday, it would mark the end of a three-week losing streak that has been the index’s longest since September, FactSet data show.

    Companies in focus
    • Tesla Inc.
      TSLA,
      +8.08%
      shares finished 8.1% higher on Thursday after posting its first rise in eight sessions Wednesday. The electric-vehicle maker’s shares had declined in seven consecutive sessions, their worst losing streak since a seven-session run that ended on Sept. 15, 2018.

    • Southwest Airlines 
      LUV,
      +3.70%
      remains in focus as the airline tries to recover from logistical issues that caused thousands of flight cancellations over the past week. The stock fell 11% over the past two days, but rose 3.7% in Thursday session.

    • General Electric’s 
      GE,
      +2.17%
      spinoff of GE HealthCare Technologies will join the S&P 500 index when it begins trading as a separate public company on Jan. 4. GE HealthCare will replace Vornado Realty Trust 
      VNO,
      +1.63%      ,
      which will move to the S&P MidCap 400. Vornado will replace logistics company RXO
      RXO,
      +8.39%      ,
      which will move to the S&P SmallCap 600. GE HealthCare — trading on a when-issued basis — rose 0.9%, while Vornado gained 1.6% and RXO jumped 8.4%.

    • Cal-Maine 
      CALM,
      -14.50%
      shares ended 14.5% lower after its quarterly earnings came in below Wall Street forecasts. Cal-Maine reported record sales for the quarter as an avian flu outbreak continued to limit the supply of eggs, driving prices sharply higher. The company also said there were no positive tests for avian flu at any of its production facilities, as of Wednesday.

    — Jamie Chisholm contributed to this article

    [ad_2]

    Source link

  • ‘Five days that killed the year’: These trading sessions accounted for 95% of the S&P 500’s losses in 2022

    ‘Five days that killed the year’: These trading sessions accounted for 95% of the S&P 500’s losses in 2022

    [ad_1]

    Just five trading sessions accounted for more than 95% of S&P 500 index losses in 2022, according to an analysis by Datatrek co-founder Nicholas Colas in a note published Wednesday, as stocks headed for their worst year since 2008.

    He described them in the note as the “five days that killed the year”: Two were caused by disappointing inflation data, while the others were triggered by weak corporate earnings and commentary from Federal Reserve Chairman Jerome Powell.

    September 13 (-4.3%)

    On the worst day for stocks since 2020, the release of the August U.S. consumer price index report sent traders into a panic when the data showed annual headline and core inflation running hotter than expected.

    The headline number came in at 8.3% for the 12 months through August, while core inflation — which strips out volatile food and energy prices — accelerated at 6.3%.

    Economists and analysts were particularly rattled by the monthly core inflation number, which came in at 0.6%, double the expected rate of 0.3%, stoking concerns about stubbornly high housing costs as energy prices began to decline after earlier being the biggest driver of this year’s inflation.

    May 18th (-4.0%). 

    Retail giant Target Corp.
    TGT,
    +0.04%
    missed first quarter earnings expectations by a wide margin, elevating worries about the U.S. consumer’s ability to cope with inflation into a full-blown panic one day after Walmart Inc.
    WMT,
    -1.64%
    highlighted similar concerns.

    Adding to the pressure on the market, during an event hosted by the Wall Street Journal Powell acknowledged that “there could be some pain involved” as the FOMC raised interest rates.

    June 13 (-3.9%)

    This day’s punishing selloff was also triggered by the release of CPI data, as the numbers for the month of May came in higher than expectations. The S&P 500 finished the session in bear-market territory for the first time in 2022, down 21.8% from the record highs reached in early January.

    April 29 (-3.6%)

    The market’s decline on this day was also triggered by a corporate earnings disappointment. However, this time, the focus was on e-commerce, and the ripple effects sent many of the megacap technology stocks reeling.

    Amazon.com Inc.
    AMZN,
    -1.16%
    — which like both Target and Walmart is a member of the consumer discretionary sector of the S&P 500 — missed earnings expectations for the first quarter while reducing its guidance. The stock ended the day down 14%, its biggest single-session decline since 2006. Apple Inc.
    AAPL,
    -2.94%    ,
    Microsoft Corp.
    MSFT,
    -0.68%
    and Google owner Alphabet Inc.
    GOOGL,
    -1.48%
    were also down sharply.

    May 5 (-3.6%)

    Markets tumbled one day after Powell assured investors during a post-meeting press conference that the Fed wasn’t considering interest-rate hikes of greater than 50 basis points. Of course, this statement didn’t age well, as the central bank went on to hike interest rates by 75 basis points at the following four consecutive meetings.

    According to Colas, investors can glean some helpful insights about the root causes of this year’s market misery from these five sessions.

    To wit, investors had clearly realized by the spring that stubbornly high inflation would force the Fed to raise its benchmark interest rate more aggressively than it was letting on. Also, inflated expectations for corporate earnings helped contribute to the pain as U.S. consumer spending waned.

    U.S. stocks sold off far more often than they traded higher this year, a deviation from the historic pattern since World War II whereby stocks typically climb far more often than they fall. Through Tuesday’s session,  the index fell during 141 trading days (including Tuesday), while finishing higher during 107 up days.

    The S&P 500 was on track to finish 2022 down more than 20% as of midday on Wednesday as all three of the main indexes were trading in the red, with the S&P 500
    SPX,
    -1.03%    ,
    Nasdaq Composite
    COMP,
    -1.20%
    and Dow Jones Industrial Average
    DJIA,
    -0.88%
    adding to their losses with just two more trading days left in the year.

    [ad_2]

    Source link

  • Apple stock drops toward 18-month low, heads for worst year since the financial crisis

    Apple stock drops toward 18-month low, heads for worst year since the financial crisis

    [ad_1]

    Shares of Apple Inc. dropped 2.8% in midday trading Wednesday, to put them on track for a fourth-straight decline and the lowest close in 18 months. The technology behemoth’s stock was the worst performer in the Dow Jones Industrial Average on the day, as the Dow slumped 288 points, or 0.9%. Apple’s stock has lost 6.7% during its four-day losing streak. It has shed 14.6% in December, to put it on track for the worst monthly performance since it tumbled 18.4% in November 2018, amid concerns over the macroeconomic backdrop and production challenges in China as COVID cases surge. Apple generated $74.20 billion in revenue from China in fiscal 2022, representing 18.8% of total revenue. With a year-to-date selloff of 28.8%, the stock is headed for the biggest yearly drop since it plunged 56.9% in 2008, during the financial crisis.

    [ad_2]

    Source link

  • Asian shares rise in thin holiday trading, with U.S., European markets closed

    Asian shares rise in thin holiday trading, with U.S., European markets closed

    [ad_1]

    BANGKOK (AP) — Shares rose Monday in Asia in thin post-Christmas holiday trading, with markets in Hong Kong, Sydney and several other places closed.

    Tokyo’s Nikkei 225 index
    NIK,
    +0.65%
    gained 0.6% to 26,393.32 and the Kospi
    180721,
    +0.15%
    in Seoul added 0.2% to 2,318.54. The Shanghai Composite index
    SHCOMP,
    +0.65%
    rose 0.5% to 3,061.93 and the SET
    SET,
    +0.47%
    in Bangkok added 0.6%.

    Bank of Japan Gov. Haruhiko Kuroda indicated in a widely watched speech Monday that the central bank does not intend to alter its longstanding policy of monetary easing to cope with pressures from inflation on the world’s third-largest economy.

    Last week, markets were jolted by a slight adjustment in the target range for the yield of long-term Japanese government bonds, viewing it as a sign the Bank of Japan might finally unwind its massive support for the economy through ultra-low interest rates and purchases of bonds and other assets.

    A widening gap between interest rates in Japan and other countries has pulled the Japanese yen sharply lower against the U.S. dollar and other currencies and accentuated the impact of higher costs for many imported products and commodities.

    But the BOJ has kept its key lending rate at minus 0.1%, cautious over risks of recession.

    Kuroda told the Keidanren, the country’s most powerful business group, that with economies facing likely downward pressure, and with Japan’s economy not fully recovered from the impacts of the pandemic, the BOJ “deems it necessary to conduct monetary easing and thereby firmly support the economy. …”

    On Friday, the S&P 500
    SPX,
    +0.59%
    reversed a 0.7% loss to close 0.6% higher, at 3,844.82. With one week left of trading in 2022, the benchmark index is down 19.3% for the year. The Dow Jones Industrial Average
    DJIA,
    +0.53%
    rose 0.5% to 33,203.93, while the tech-heavy Nasdaq
    COMP,
    +0.21%
    edged 0.2% higher, to 10,497.86.

    Small company stocks also rose. The Russell 2000 index
    RUT,
    +0.39%
    picked up 0.4% to 1,760.93.

    Mixed economic news weighed on stocks early on, but the indexes rebounded by late afternoon amid relatively light trading ahead of the long holiday weekend. U.S. and European markets will be closed Monday.

    Markets are in a tricky situation where relatively solid consumer spending and a strong employment market reduce the risk of a recession but also raise the threat of higher interest rates from the Federal Reserve as it presses its campaign to crush inflation.

    The government reported Friday that a key measure of inflation is continuing to slow, though the inflation gauge in the consumer spending report was still far higher than anyone wants to see. Also, growth in consumer spending weakened last month by more than expected, but incomes were a bit stronger than expected.

    Last week’s reports were the last big U.S. economic updates of the year. Investors will soon turn their focus to the next round of corporate earnings.

    The Fed has said it will keep raising interest rates to tame inflation, even though the pace of price increases has continued to ease. The Fed’s key overnight rate is at its highest level in 15 years, after beginning the year at a record low of roughly zero.

    The key lending rate, the federal funds rate, stands at a range of 4.25% to 4.5%, and Fed policymakers have forecast that the rate will reach a range of 5% to 5.25% by the end of 2023.

    Given the persistence of high inflation, “many are starting to believe the main story is that there will be no scope for Fed cuts in the year ahead and that central banks will maintain these relatively high rates until underlying inflation is truly cracked — and that process will take time,” Stephen Innes of SPI Asset Management said in a commentary.

    The Fed’s forecast doesn’t call for a rate cut before 2024, and the higher rates have raised concerns the economy could stall and slip into a recession in 2023. High rates have also been weighing heavily on prices for stocks and other investments.

    In currency dealings, the U.S. dollar
    DXY,
    -0.10%
    slipped to 132.62 Japanese yen from 132.82 yen late Friday. The euro rose to $1.0629 from $1.0614.

    [ad_2]

    Source link

  • Equity funds suffer largest ever weekly outflows: BofA Global

    Equity funds suffer largest ever weekly outflows: BofA Global

    [ad_1]

    Investors withdrew billions of dollars from equity funds at a record pace in the days after the Federal Reserve, the Bank of England and European Central bank raised interest rates in mid-December and reiterated their commitment to lowering inflation, fueling fears of an economic downturn. 

    Stock funds recorded the biggest ever weekly outflows of $41.9 billion in the week to December 21, with $27.8 billion of which being withdrawn from exchanged traded funds and $14.1 billion from mutual funds, according to analysts at BofA Global Research, citing EPFR Global data in a weekly note. 

    BofA analysts led by Michael Hartnett, chief investment strategist, attributed the sell-off to “tax loss harvesting,” a strategy that includes deliberately selling an investment at a loss in order to use that loss to offset taxes owed on investment gains. 

    Meanwhile, passive equity funds saw total outflows of $27.8 billion in the week to Wednesday, while U.S. value funds recorded a weekly outflow of $17.2 billion (see chart below). Both were the biggest sell-off on record.

    SOURCE: BOFA GLOBAL INVESTMENT STRATEGY, BLOOMBERG

    The BofA’s Bull & Bear Indicator dipped to 3.0 from 3.1 last week, driven by the first bond fund outflows in three weeks. Bond funds recorded net outflows of $10 billion.

    For the year however, BofA said equity funds saw total inflows of $166.5 billion. In contrast, bond funds recorded outflows of $257.1 billion.

    U.S. stock indexes have fallen since Wednesday last week when the Federal Reserve raised its benchmark interest rate at a slower pace to a range of 4.25% to 4.50%, but projected a higher-than-expected terminal rate in 2023.

    Not long after the decision, central banks in Europe followed the Federal Reserve in slowing the pace of interest rate increases. Both the European Central Bank and Bank of England hiked their key lending rates by 50 basis points and policy makers at the ECB emphasized that market participants should prepare for a series of rate increases to come. 

    See: Here’s how U.S. investors can position themselves for the sea change out of Japan, according to Bank of America and Citi

    Earlier this week also, the Bank of Japan (BoJ) stunned markets with an unexpected change to its controversial yield curve control policy. The BoJ, an outlier among major central banks for having maintained rates at the zero lower bound, doubled the cap on the country’s 10-year bond yield
    TMBMKJP-10Y,
    0.383%
    from 0.25% to 0.5%, whacking equities in the region and triggering big swings in the U.S. stock market.

    Strategists at BofA said they are bullish on commodities instead of credit, and preferred “rest of the world” stocks over U.S. stocks, while favoring small-cap over large-cap. 

    Sector wise, they preferred value over growth stocks, and industrials and banks over technology and private equity. 

    See: A stock market indicator with one of the best track records has rare good news for investors

    U.S. stocks ended the week mostly lower on Friday. The Dow Jones Industrial Average 
    DJIA,
    +0.53%
     booked a weekly gain of 0.9%, while the Nasdaq Composite 
    COMP,
    +0.21%
    shed nearly 2% and the S&P 500
    SPX,
    +0.59%
    was down 0.2% for the week, according to Dow Jones Market Data. 

    [ad_2]

    Source link

  • This week’s best-performing stocks include a popular sports apparel name and a drug maker

    This week’s best-performing stocks include a popular sports apparel name and a drug maker

    [ad_1]

    [ad_2]

    Source link

  • Scott Minerd, prominent Guggenheim Partners money manager, dies unexpectedly of heart attack

    Scott Minerd, prominent Guggenheim Partners money manager, dies unexpectedly of heart attack

    [ad_1]

    Guggenheim Partners Global Chief Investment Officer Scott Minerd has died, the company announced in a press release issued Thursday. He was 63.

    The money manager was one of the most prominent on Wall Street, known for his calls on stocks, bonds and Federal Reserve policy as well as for his muscular physique.

    Reports indicated that Minerd suffered a heart attack during a workout. He died on Wednesday afternoon.

    “We’re deeply saddened by the death of Scott Minerd and send our deepest condolences to his husband, friends and family,” said Gerard Carney, a spokesman for Guggenheim Partners.

    Minerd became CIO of Guggenheim Partners in 1999, shortly after the firm was founded. He was a frequent commentator in the media, making calls on the S&P 500
    SPX,
    -1.45%    ,
    the Dow Jones Industrial Average
    DJIA,
    -1.05%
    and Treasurys.

    Read: Guggenheim’s Minerd believes fine art, real estate will outperform stocks, sees bitcoin bottoming at $8,000

    Also see: Fed may need to pivot by early November, when ‘something breaks,’ says Guggenheim’s Scott Minerd

    He was known for his macro approach to investing and as a fixed-income expert who understood structured securities and currencies. He was employed at Merrill Lynch, Morgan Stanley and Credit Suisse First Boston in the 1980s and 1990s, working with legendary CEOs John Mack and Bob Diamond.

    In 2017, he told Bloomberg that he had “walked away from extremely large offers on Wall Street” because he had become burnt out at age 37. “I realized this wasn’t a dress rehearsal for life, this was it,” he said.

    “I have known Scott for over 30 years and we were partners much of that time,” wrote Mark Walter, CEO and a founder of Guggenheim. “Scott was a key innovator and thought leader who was instrumental in building Guggenheim Investments into the global business it is today.

    “He will be greatly missed by all. My deepest condolences are with his husband, family and loved ones,” Walter wrote.

    At his peak, Minerd could bench-press nearly 500 pounds, and he competed in the super-heavyweight and over-40 divisions of L.A. bodybuilding championships.

    The son of an insurance salesman, Minerd grew up in southwestern Pennsylvania on land where his family settled before the Revolutionary War, Bloomberg reported.

    Members of the investment community were stunned by news of Minerd’s death.

    Billionaire Bill Ackman, who runs the hedge fund Pershing Square Capital Management, described Minerd as a “brilliant man.”

    “He was also a lot of fun. I wish I had more time with him. Carpe diem,” Ackman wrote via Twitter.

    [ad_2]

    Source link

  • U.S. stocks log biggest jump in almost 2 weeks on strong earnings, consumer sentiment

    U.S. stocks log biggest jump in almost 2 weeks on strong earnings, consumer sentiment

    [ad_1]

    U.S. stocks cemented their biggest daily advance in almost two weeks on Wednesday as investors reacted to optimistic earnings from Nike Inc. and FedEx Corp., along with a surprisingly strong reading on consumer confidence. The S&P 500
    SPX,
    +1.49%
    gained 56.82 points, or 1.5%, to finish at 3,878.44, according to Dow Jones Market Data. The Nasdaq Composite
    COMP,
    +1.54%
    advanced 162.26 points, or 1.5%, to close at 10,709.37. The Dow Jones Industrial Average
    DJIA,
    +1.60%
    gained 526.74 points, or 1.6%, to finish at 33,376.48.

    [ad_2]

    Source link

  • Tesla Shares Are Weak. The Reason Why Is in the Stock Chart.

    Tesla Shares Are Weak. The Reason Why Is in the Stock Chart.

    [ad_1]

    Tesla stock is weak again despite the likelihood CEO Elon Musk will step down as head of Twitter and earnings estimates for 2023 staying stable.

    Investors are perplexed, but traders know why. Investors can’t, or shouldn’t, ignore the stock chart.

    [ad_2]

    Source link

  • The Fed Is Making a Mistake—and the Stock Market Will Pay the Price

    The Fed Is Making a Mistake—and the Stock Market Will Pay the Price

    [ad_1]

    We all make mistakes—but the Federal Reserve may be making a bigger one than most. That could mean another difficult year for the stock market in 2023.

    Those concerns were front and center this past week, following the Federal Open Market Committee’s December meeting. The Fed didn’t do anything to surprise the market as it raised the federal-funds rate by a half-point, just as everyone expected, and suggested a terminal rate of just over 5%, a level investors had slowly come around to. But the dot plot reflected the Fed’s belief that rates would have to go high and stay high, while Chairman Jerome Powell continued to strike a hawkish tone.

    [ad_2]

    Source link

  • Final Trades: TGT, EWZ, XLE & LMT

    Final Trades: TGT, EWZ, XLE & LMT

    [ad_1]

    The final trades of the week. With CNBC's Melissa Lee and the Fast Money traders, Tim Seymour, Dan Nathan, Guy Adami and Bonawyn Eison.

    [ad_2]

    Source link

  • Why the Chartmaster Carter Worth sees more pain for the hard hit financials

    Why the Chartmaster Carter Worth sees more pain for the hard hit financials

    [ad_1]

    Share

    Carter Worth of Worth Charting looks at what’s next for regional banks. With CNBC’s Melissa Lee and the Fast Money traders, Tim Seymour, Dan Nathan, Guy Adami and Bonawyn Eison.

    [ad_2]

    Source link

  • Blackstone drops as the SEC looks into real estate fund redemptions

    Blackstone drops as the SEC looks into real estate fund redemptions

    [ad_1]

    BX was down another 4% this week as BREIT draws SEC interest. With CNBC's Melissa Lee and the Fast Money traders, Tim Seymour, Dan Nathan, Guy Adami and Bonawyn Eison.

    [ad_2]

    Source link

  • Stocks could face another explosion of volatility Friday as $4 trillion of options expire in ‘quadruple witching’

    Stocks could face another explosion of volatility Friday as $4 trillion of options expire in ‘quadruple witching’

    [ad_1]

    Stocks have been on a wild ride this week, and conditions could still get weirder as traders brace for “quadruple witching” on Friday, when a flurry of equity options and futures contracts expire.

    In particular, options contracts tied to $4 trillion in stocks, stock-index futures and exchange-traded funds are set to expire, making Friday potentially the busiest day for options traders this year, according to data compiled by Rocky Fishman, the head of index volatility research at Goldman Sachs.

    The…

    [ad_2]

    Source link

  • Why 2023 Could Be Tough on Tesla

    Why 2023 Could Be Tough on Tesla

    [ad_1]

    This copy is for your personal, non-commercial use only. To order presentation-ready copies for distribution to your colleagues, clients or customers visit http://www.djreprints.com.

    https://www.barrons.com/articles/tesla-rivian-lucid-stock-ev-demand-51671055341

    • Order Reprints
    • Print Article

    Eventually supply and demand realities catch up with everyone—even


    Tesla

    Morgan Stanley analyst Adam Jonas looked into 2023 and sees some concerning signs for electric-vehicle makers.

    [ad_2]

    Source link

  • GE HealthCare Is About to Be Independent. This Is Where the Stock Should Trade.

    GE HealthCare Is About to Be Independent. This Is Where the Stock Should Trade.

    [ad_1]

    To start 2023, investors will have a choice to invest in a brand new $18 billion company with some 50,000 energized employees and a plan to create shareholder value.

    To close out 2022, that company—GE HealthCare—is on the road, introducing itself to investors. With each new detail that emerges investors get a better sense of where the new stock should trade.

    [ad_2]

    Source link

  • The Stock Market Had a Terrible Week—and Now the Fed Meeting Is on Tap

    The Stock Market Had a Terrible Week—and Now the Fed Meeting Is on Tap

    [ad_1]

    Things tend to slow down for the holidays. The stock market isn’t there yet.

    With Christmas just a couple of weeks away, it’s easy to look ahead to candy canes, caroling, and presents under the tree, but there’s still work to be done. The coming week certainly won’t be boring, with highly anticipated inflation data and a Federal Reserve decision on back-to-back days. The two events will do much to determine the direction of the market for the coming weeks—a deeper slide or a resumption of the Santa Claus rally.

    [ad_2]

    Source link

  • Stocks finish lower, Dow drops 300 points to cap off worst week in more than 2 months

    Stocks finish lower, Dow drops 300 points to cap off worst week in more than 2 months

    [ad_1]

    U.S. stocks finished Friday’s choppy session with modest losses, capping off the worst week for stocks since September after a report on wholesale-price inflation challenged assumptions about slowing inflation in the U.S. The Dow Jones Industrial Average dropped 2.8% this week, its biggest pullback since at least the week ended Sept. 30, according to FactSet data. The blue-chip index finished Friday’s session
    DJIA,
    -0.90%
    down 305.02 points, or 0.9%, at 33,476.46. The S&P 500
    SPX,
    -0.73%
    shed 29.13 points, or 0.7%, to 3,934.38, capping off a weekly drop of 3.4%, its biggest pullback since September. The Nasdaq Composite
    COMP,
    -0.70%
    fell 77.39 points, or 0.7%, to 11,004.62.

    [ad_2]

    Source link

  • The Dow industrials are on the verge of a ‘golden cross,’ even as BlackRock predicts recession like no other

    The Dow industrials are on the verge of a ‘golden cross,’ even as BlackRock predicts recession like no other

    [ad_1]

    Despite worries about inflation and an impending recession, there is at least one sign that some bullish market technical analysts might latch onto.

    An upbeat golden cross appears to be forming in the Dow Jones Industrial Average 
    DJIA,
    -0.90%    ,
     more than nine months after a bearish death cross formed back in March, as the hawkish agenda of the Federal Reserve shattered bullishness on Wall Street.

    A golden cross occurs when the 50-day moving average for an asset price trades above the 200-day MA, while a death cross, comparatively, is when the 50-day falls below the long-term average.

    The 50-day moving average for the Dow stands at 32,200.32, at last check Friday afternoon, while the 200-day sits at 32,460.71, a roughly 260-point difference that could be traversed in the coming week or two, based on its current trajectory.


    FactSet

    A golden cross would mark the first for the Dow industrials since 2020 of August, according to Dow Jones Market Data.

    The bullish chart formation also would appear at an odd time for investors, with an apparent uptrend materializing in the stock market, even as the threat of a recession in 2023 grows.

    Read: Financial markets are flashing a warning that a recession is imminent: here’s what it means for stocks

    See: Goldman Sachs CEO says recession is likely, with 35% chance of a soft landing

    BlackRock, the world’s largest asset manager, is anticipating a unique recession unlike others that we’ve seen in U.S. history.

    “The new macro regime is playing out. We think that requires a new, dynamic playbook based on views of market risk appetite and pricing of macro damage,” wrote BlackRock’s Investment Institute team led by Jean Boivin.

    The BlackRock team said markets aren’t necessarily pricing in the recession that is being predicted.

    “Central banks appear set on doing ‘whatever it takes’ to fight inflation, making recession foretold, in our view,” the team at BlackRock wrote.

    As MarketWatch’s Tomi Kilgore notes, crosses, overall, aren’t necessarily good market-timing indicators.

    Check out: MarketWatch’s live blog of the market

    On top of that, MarketWatch columnist Mark Hulbert concludes that the U.S. stock market on average has performed no better in the wake of a golden crosses as it did at other times.

    In many cases, a golden cross can help put an asset’s move into perspective, however, they tend to be well telegraphed.

    Interestingly, the recession is also being widely predicted and some don’t think investors are getting the memo. As BlackRock notes, investors aren’t reflecting the damage that is to come, particularly as earnings expectations from American companies are right-sized.

    So, it might be worth it for investors to take any golden crosses in assets with a grain of salt.

    So far, the Dow industrials have outperformed over the past three months, up about 5%, compared with a decline of 2.5% for the S&P 500
    SPX,
    -0.73%
    and an 8.2% drop for the Nasdaq Composite
    COMP,
    -0.70%    .

    Over the past three months, the Dow industrials have recent in aggregate on the back of gains in shares of Caterpillar
    CAT,
    -1.56%    ,
    Boeing Co.
    BA,
    +0.20%
    Merck & Co.
    MRK,
    -1.86%    ,
    IBM
    IBM,
    -0.47%
    and Travelers Cos.
    TRV,
    -1.10%    .

    For the year so far, the Dow is down 7%, while the S&P 500 is off 17% and the Nasdaq is down nearly 30%.

    [ad_2]

    Source link

  • Sinema ditches Democrats, but analysts say it’s no Senate earthquake, just a re-election gambit

    Sinema ditches Democrats, but analysts say it’s no Senate earthquake, just a re-election gambit

    [ad_1]

    Sen. Kyrsten Sinema announced Friday that she’s leaving the Democratic Party to register as an independent.

    So what does that mean?

    The initial reaction from analysts is that the Arizona lawmaker’s move won’t shake up how the Senate functions that much, and that it has more to do with her possible 2024 campaign for re-election.

    “At this point, we don’t expect Sinema’s defection to formally change the balance of power in the Senate,” said Benjamin Salisbury, director of research at Height Capital Markets, in a note.

    “Two independents, Senators Angus King [of Maine] and Bernie Sanders [of Vermont], formally caucus with Democrats,” Salisbury noted. “While Sinema declined to say which party she would caucus with, she did say that the change would not change how she votes, and she plans to keep her committee assignments, which is an indication to us that she will keep her affiliation with Democrats. In our view, the move is more about positioning herself for a tough 2024 reelection.”

    Sinema, who has been criticized frequently by progressive Democrats for moves such as opposing changes to the so-called carried-interest loophole, was expected to face a challenge from the left in a Democratic primary. But as an independent, she can avoid a primary and focus on the general election in her battleground state.

    Her calculation is that “the progressive Democratic ‘brand’ won’t help her to reelection in Arizona, but centrists and some from each party will,” Terry Haines, founder of Pangaea Policy, wrote in a note. “So there’s no percentage in doing anything but emphasizing her independence, and this is a high-profile, direct, and effective way of doing it.”

    Haines said the senator’s move isn’t an earthquake for the Senate: “Sinema herself says it’s not so, that she’ll continue to do the job in the same way — and there’s no reason to dispute it.”

    He also wrote that the “basic result for 2023-24 is as it was before Sinema’s announcement: domestic gridlock, basic fiscal/government spending stability, and continued foreign policy unanimity, particularly on China and Ukraine.”

    The Biden White House offered a similar reaction on Friday, saying that Sinema’s decision to “register as an independent in Arizona does not change the new Democratic majority control of the Senate, and we have every reason to expect that we will continue to work successfully with her.”

    Sinema has voted with Democrats 97% of the time, according to Bloomberg Government data.

    Related: Mitch McConnell praises Kyrsten Sinema as ‘the most effective first-term senator’ he’s seen in his career

    And see: Republicans clinch slim majority in House, likely signaling 2023 gridlock ahead

    Senate Majority Leader Chuck Schumer said Sinema would keep her committee assignments.

    “I believe she’s a good and effective Senator and am looking forward to a productive session in the new Democratic majority Senate,” Schumer, a New York Democrat, also said. “We will maintain our new majority on committees, exercise our subpoena power, and be able to clear nominees without discharge votes.”

    For the past two years, Democrats have controlled the 50-50 Senate only because Vice President Kamala Harris can cast tiebreaking votes.

    Following Georgia Democratic Sen. Raphael Warnock’s win on Tuesday over Republican challenger Herschel Walker in their closely watched runoff election, Democrats were expected to enjoy a 51-49 majority in the Senate.

    There’s talk that Sinema’s announcement on Friday may have changed that, but analysts such as Salisbury and Haines are pushing against that view.

    “Sinema’s defection is another sign of the tentative rise of overt bipartisanship in Congress,” Haines wrote. “There’s an increasing view that solving issues is what the vast majority of voters want, and some legislators seem prepared to risk the wrath of their party establishments to achieve it.”

    Most U.S. senators have been affiliated with a major political party, but more than 70 have been independents or represented a minor party, according to Senate records.

    Former Sen. Joe Lieberman of Connecticut is a recent example of that group, as he started out as a Democrat, then became an independent but still caucused with his former party. That’s even as Democratic leaders criticized him for backing the late Republican John McCain in the 2008 presidential race.

    U.S. stocks 
    SPX,
    -0.73%
     
    DJIA,
    -0.90%
    traded mixed Friday and were on track for weekly losses.

    [ad_2]

    Source link