The stock market continued its downward trend as all major indexes dropped. Recession worries dragged financial stocks down as Treasury yields continued to climb.
The Nasdaq composite fell 0.6%. The S&P 500 shed 0.5%, and the Dow Jones Industrial Average was down 0.4%. The Russell 2000 lost 1%.
Volume rose on the Nasdaq and fell on the NYSE vs. the same time on Wednesday.
Two popular Chinese stocks fell after earnings reports. Chinese internet company Bilibili (BILI) reported first-quarter results early Thursday that exceeded revenue estimates but fell short on earnings, as Covid-19 lockdowns created new challenges. BILI stock plunged more than 18%.
U.S. Stock Market Today Overview
|Last Update: 1:32 PM ET 6/9/2022|
China-based Nio (NIO) beat first-quarter earnings estimates early Thursday and implied a big jump in June deliveries as the country’s Covid lockdown winds down. Nio expects Q2 deliveries of 23,000 to 25,000 vehicles, which would mean an increase of 5% to 14% vs. a year earlier, but down slightly from Q1.
Nio shares fell 8%, breaking a rally that took the stock up more than 23% from May 27.
Economic News Sparks Concern Of Stagflation
Samsung reportedly is eyeing an acquisition of European chipmaker NXP Semiconductors (NXPI) to increase its exposure to the automotive chip market. NXPI stock jumped on the news.
Asian Tech Press reported Wednesday that Samsung’s de facto leader, Lee Jae-yong, plans to discuss a possible purchase of the Netherlands-based chipmaker during his visit to Europe June 7-18.
Financial stocks took a beating on fears of the coming of stagflation, where rising inflation is accompanied by low economic growth. The S&P Financial Select Sector ETF (XLF) dropped 1.1%, second only among S&P sectors to the Energy Select Sector ETF (XLE), which lost 1.4%. XLF looked to be gaining support from its 50-day as it attempted to cross that line a couple days ago.
The yield on the 10-year Treasury note rose 2 basis points to 3.04%. The benchmark yield has jumped more than 30 basis points in two weeks. The price of U.S. crude oil fell 0.3% to $121.77 a barrel.
The European Central Bank said it intends to raise its key rate by a quarter percentage point. It would be its first rate increase in more than a decade, and add the ECB to the list of central banks raising rates to battle inflation.
Adding fuel to the fire of recession woes, the number of U.S. jobless claims jumped to 229,000 from 202,000 the previous week. Economists polled by Econoday had forecast 210,000.
Big Banks Drag Stock Market Lower
Big commercial and investment banks all slid 1% to 3%. Among them were Citigroup (C), Bank of America (BAC), Wells Fargo (WFC) and Goldman Sachs (GS).
Greif (GEF) soared more than 6% Thursday after it reported earnings and sales that easily beat analyst estimates for its fiscal second quarter. The Ohio-based company makes steel and plastic containers and packaging.
Walt Disney (DIS) stock dropped 1.7% after the company said Peter Rice, who was seen as a possible successor in the future to Disney CEO Robert Chapek, is leaving the company.
The Innovator IBD 50 ETF (FFTY) fell nearly 2%. Amphastar Pharmaceutials (AMPH) was the worst stock on the IBD 50. The biotech plummeted 17% in heavy volume, which caused a sell signal. The stock was dropped from Leaderboard.
Darling Ingredients (DAR) fell back below the 85.02 buy point of a breakout on Tuesday from a cup-with-handle base. Also in the IBD 50, Eagle Bulk Shipping (EGLE) dipped below its 50-day moving average as shipping stocks continued to sink.
Tesla‘s (TSLA) sales in China improved sharply from April, when production was shut down due to a Covid lockdown. News reports said Tesla’s China operations are back to full strength. Tesla stock rose 2% in heavy volume.
UBS upgraded Tesla to buy from neutral today, saying the company’s “operational outlook is stronger than ever.”
Follow Michael Molinski on Twitter @IMmolinski
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