US stocks were mixed at the end of Tuesday’s volatile session as markets struggled to recover from a sharp sell-off that sent all three major indexes to their lowest level in a year so far this week.
The S&P 500 was 0.3% higher after the benchmark closed below 4,000 for the first time since Monday, March 2021, deepening losses from its longest series of weekly declines since 2011. The Dow Jones industrial average fell for fourth consecutive day to close 85 points, or 0.3% less, and the Nasdaq Composite rose by approximately 1%.
These moves extend the period of recent turmoil in stock markets, as concerns about inflation, rising interest rates and the possibility of a slowdown continue to weigh on investor sentiment.
“What you’re seeing in the markets right now is just a complete reset and reassessment not only of interest rates but also of inflation expectations,” Megan Horneman of Verdence Capital Advisors told Yahoo Finance, adding: “I think we’re waiting for a bit of an ugly picture of inflation “for the rest of 2022
“The market is devoid of major positive catalysts at the moment, so it’s no surprise that we’re starting the weekend under pressure,” said Brian Price, head of investment at the Commonwealth Financial Network’s investment department, in an e-mail note.
An additional problem is the weak profit season, which has raised concerns about how corporate profits will develop amid persistent macroeconomic disruptions. As of Friday, the percentage of companies in the S&P 500 that exceeded EPS estimates was above the five-year average, but the number of surprise surprises was below the five-year average, according to FactSet.
“Another catalyst that could cause some risk aversion in recent times is the rather unfavorable profit season,” Price added. “It has certainly not been as strong as it has been in the last few quarters, and there is even more uncertainty about the future prospects for EPS, given the huge amount of macro uncertainty.”
The story continues
For this profit season so far, 87% of companies in the S&P 500 have reported actual results for the first quarter of the year to date, according to the latest available data from FactSet.
Peloton Interactive (PTON) fell 13 percent in intraday trading on Tuesday after the company reported a higher quarterly loss for the period ended March 31, along with a sharp drop in sales.
Investors are expecting bigger reports that are underway this week from big names, including Disney (DIS), Rivian Automotive (RIVN), Occidental Petroleum (OXY) and Coinbase (COIN).
In terms of economic data, the consumer price index (CPI) from Wednesday will also be closely monitored by traders for the latest picture of the state of inflation in the United States. The figure is expected to offer clues as to how aggressively the Federal Reserve will need to act to mitigate rising prices.
“The stock market continues to struggle, given the effects of inflation and rising market interest rates on stock prices,” Comerica Wealth Management CEO John Lynch said in a note Monday.
“It’s a ride on a rope by the Fed. “If it moves too slowly, it risks not suppressing inflation and embedding higher inflation expectations, making it harder to eliminate,” Lynch said. “Conversely, if the Fed raises interest rates too quickly, it risks pushing the economy into recession, with job losses and other costs. The Fed really has a difficult task ahead of it.”
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16:00 ET: Dow closes lower for the fourth consecutive session
Here’s how the major indexes narrowed the session back and forth on Tuesday:
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S&P 500 (^ GSPC): +9.75 (+ 0.24%) to 4,000.99
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Dow (^ DJI): -85.55 (-0.27%) to 32,160.15
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Nasdaq (^ IXIC): +114.42 (+ 0.98%) to 11,737.67
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Crude oil (CL = F): $ -3.27 (-3.17%) to $ 99.82 per barrel
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Gold (GC = F): – $ 20.40 (-1.10%) to $ 1838.20 per ounce
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10-year treasury (^ TNX): -8.6 bps for 2.9930% yield
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11:50 a.m. ET: Shares Deny Gains, Extending Sale to Fourth Consecutive Day
Here are the main market movements at 11:50 ET:
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S&P 500 (^ GSPC): -12.66 (-0.32%) to 3978.58
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Dow (^ DJI): -139.89 (-0.43%) to 32,105.81
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Nasdaq (^ IXIC): +2.40 (+ 0.02%) to 11,625.65
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Crude oil (CL = F): -1.86 dollars (-1.80%) to 101.23 dollars per barrel
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Gold (GC = F): – $ 12.80 (-0.69%) to $ 1845.80 per ounce
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10-year treasury (^ TNX): -13.5 bps for a yield of 2.9440%
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9:30 a.m. ET: Shares jump in market attempts to return from lowest level year-to-date
Here is where all three main indices were traded at the beginning of the session:
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S&P 500 (^ GSPC): +73.98 (+ 1.85%) to 4,065.22
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Dow (^ DJI): +467.54 (+ 1.45%) to 32,713.24
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Nasdaq (^ IXIC): + 295.81 (+ 2.54%) to 11,919.06
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Crude oil (CL = F): -0.41 $ (-0.40%) to $ 102.68 per barrel
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Gold (GC = F): + $ 2.90 (+ 0.16%) to $ 1,861.50 per ounce
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10-year treasury (^ TNX): -11.2 bps for a yield of 2.9670%
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7:10 a.m. ET: Contracts for all three indices rise after shares fall to lowest level this year
Here are the main moves in futures trading before the start of the bell on Tuesday:
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S&P 500 futures (ES = F): +30.50 (+ 0.76%) to 4,018.00
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Dow futures (YM = F): +213.00 (+ 0.66%) to 32,374.00
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Nasdaq futures (NQ = F): +148.50 (+ 1.22%) to 12,342.25
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Crude (CL = F): $ -1.64 (-1.59%) to $ 101.45
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Gold (GC = F): – $ 0.50 (-0.03%) to $ 1858.10 per ounce
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10-year treasury (^ TNX): -4.4 bps for 3.0790% yield
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18:14 ET Monday: stock futures rise after S&P 500 closes below 4,000
Here’s where stock futures traded on Monday night:
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S&P 500 futures (ES = F): +10.50 (+ 0.26%) to 3998.00
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Dow futures (YM = F): +78.00 (+ 0.24%) to 3,998.00
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Nasdaq futures (NQ = F): +42.00 (+ 0.34%) to 12,235.75
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Crude (CL = F): – $ 0.30 (-0.29%) to $ 102.79
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Gold (GC = F): – $ 5.30 (-0.29%) to $ 1853.30 per ounce
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10-year treasury (^ TNX): -4.4 bps for 3.0790% yield
A trader works on the floor of the New York Stock Exchange (NYSE) in New York, USA, May 9, 2022. REUTERS / Brendan McDermid
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Alexandra Semenova is a reporter for Yahoo Finance. Follow her on Twitter @alexandraandnyc
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