One day after making encouraging reversals, the stock market indexes could not sustain momentum and indexes sold off Tuesday morning. Alphabet (GOOGL) and Microsoft (MSFT) announce earnings after the close, and several key reports are already out.
The S&P 500 was off 1.1% while the Nasdaq composite sold off 2.2%. Small caps also slid, with the Russell 2000 down 1.3%.
The Dow Jones Industrial Average was down 0.7%. Visa (V) was down 2.4% ahead of its earnings report after the close today.
Volume fell on the Nasdaq and NYSE compared with the same time on Monday.
Stock Market Gets Earnings Reports
There was little else for the stock market to digest except for earnings, and there’s a heavy batch today.
U.S. Stock Market Today Overview
|Last Update: 10:16 AM ET 4/26/2022|
Alphabet, the parent of Google and YouTube, is expected to earn $25.70 a share, a drop of 2% from the year-ago period, according to FactSet. Sales are estimated to climb 23% to $68 billion. The stock is trading near nine-month lows.
Analysts expect Microsoft, down 2% today, to earn $2.19 a share, up 12%, on sales of $49.02 billion. The stock is testing support around the 270 price level.
Earlier today, Raytheon (RTX) reversed higher after the military hardware maker beat first-quarter estimates and revenue came in slightly below views. The company’s guidance was disappointing, but it said it will buy back at least $2.5 billion of its stock this year. Raytheon stock fell below the 50-day moving average Monday but closed back above the line. Today, it’s again finding support at the line.
Entegris, UPS, JetBlue Earnings
Entegris (ENTG) reversed lower and remains deep in a correction. The chip-equipment maker beat Q1 expectations and guided higher for the current period and the full year. Although the company believes supply chain problems will remain a problem all year, it still expects record demand. It could be taken as a good sign ahead of other earnings reports in the industry.
United Parcel Service (UPS) sank to the lowest price since Oct. 13 despite beating expectations and giving a solid outlook. UPS has been falling this month along with other shipping stocks as freight rates cool off.
JetBlue (JBLU) lost nearly 7% in heavy volume. The airline reported a smaller loss than expected as demand surged in Q1. But JetBlue said it will cut capacity growth to “restore operational reliability” and catch up on a backlog of training. The company also said it is mindful of high fuel prices.
The Innovator IBD 50 ETF (FFTY) fell 0.7%. Tesla (TSLA) was the worst performing IBD 50 stock, down nearly 7% in heavy volume. Tesla stock is forming a cup-with-handle base, but the handle is now too deep with a 16% decline.
Stock Market Gets Economic Data
Orders for durable goods rose 0.8% in March, below views for a 1% increase. Excluding transportation items, orders rose 1.1%, well above forecasts for a 0.5% increase. Core capital goods also beat views with a 1% rise.
Core orders, which consist of nondefense items excluding aircraft, rose 1%. It marked the 12th gain in the past 13 months, says BMO Capital Markets economist Jennifer Lee. She called it encouraging news for future investment. “The solid increase in core orders suggests that businesses remain in good shape, and are still looking to bulk up machines and equipment to contribute to their bottom lines.”
The S&P CoreLogic Case-Shiller 20-city home price index rose 2.4% on an adjusted basis in February, above forecasts for a 1.5% increase. The index surged 20.2% from a year ago, also above estimates.
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