Stocks fall. Stocks on Wall Street fell a lot in the first few minutes of trading this morning as investors looked over the most recent corporate earnings and kept an eye on rising prices and the virus pandemic.
(At 10:30 a.m. Eastern, the S&P 500 was down 1.3%). At 35,000, the Dow Jones Industrial Average lost 534 points. That’s 1.5% of its value. The Nasdaq lost 1.2%. Technology stocks and banks pushed the market down the most. Nvidia and JPMorgan Chase both lost a lot of money.
Goldman Sachs fell 7.7% after the investment bank said its fourth-quarter profits were down 13% from last year. This was mostly because the bank was preparing to pay out a lot of money to its employees.
A lot of people lost their jobs and homes. More than 90% of the stocks in the S&P 500 fell. Investors are also worried about rising prices and the virus pandemic, which is still a threat. The benchmark index is also down for the second week in a row.
Big technology stocks, which have a big impact on the S&P 500 because of their high prices, have been having a big impact on the market in January. A lot of people have been moving money around because they think interest rates will go up, which makes expensive tech stocks less appealing.
A year ago, Wall Street thought the Federal Reserve would start cutting back on its bond purchases and raise interest rates more often than it did now.
Bond yields rose. There was a big change in the yield on the 10-year Treasury. It went from 1.77 percent to 1.84 percent.
Energy stocks were one of the bright spots in the market, even though there were fears about a lack of oil after an attack on an oil facility in the capital of the United Arab Emirates. Price of crude oil in the U.S. went up 1.6%, and Exxon Mobil’s stock went up 2.5%
Activision Blizzard’s stock rose 27.5 percent after news broke of a big deal. When Microsoft, which fell 0.5 percent, agreed to pay $68.7 billion for the company that makes games like “Call of Duty,” “Candy Crush,” and “Call of Duty: Black Ops II.”
They have a lot of earnings reports to look forward to this week. A big part of the class will be about how businesses in different industries are dealing with problems with their supply chains. Many businesses have already warned about the effect on their finances and operations, even though they have raised the prices of consumer goods to try to make up for it.
On Wednesday, Bank of America, UnitedHealth, and United Airlines will report their results for the month. They report their results on Thursday. American Airlines, Union Pacific, and Netflix are all going to do that, too,
wpDiscuz