Wednesday, July 17, 2024

Nasdaq is rising, Dow Jones and S&P are caught in inflation fears


U.S. stocks ended lower on Thursday because investors are worried that inflation will be higher than expected, which could push the Federal Reserve to raise interest rates even more sharply.
The Dow Jones Industrial Average fell 88.75 points, or 0.28 percent, to 31,745.36. The Standard & Poor’s 500 Index was down 4.21 points, or 0.09 percent, at 3,931.48. The Nasdaq Joint Index was up 6.99 points, or 0.12 percent, at 11,371.23.
The Dow Jones industrial average fell for the sixth day in a row, as traders failed to gain a foothold in the increasingly volatile market.
Earlier today, the market was trying to recover as traders bought fewer names. At one point, the Dow rose 80 points to a session high, while the Nasdaq added 1.61%. At session low, the Dow was up over 500 points and the Nasdaq was down 2.25%.
The S&P 500 reached a new low for 2022, closed more than 18% from its 52-week high and is approaching bear market share.
Among the key averages, the Nasdaq is the only one in the bear market, with technology stocks continuing to fall nearly 30% from its record high.
Some very short names led to the short rally attempt of the market the previous day and closed with a rise. Lucid shares rose 13.2%, while Gamestop and AMC rose 10% and 8%, respectively. The Rivian is up nearly 18% after the announcement of its latest quarterly results.
While it is not clear what caused the gains by Lucid Gamestop and AMC, it could mean a short-term strain as hedge funds that profited from the massive losses of this year’s epidemic winners finally closed their narrow positions by buying shares.
Short sale is a ploy to sell shares borrowed from investment banks and require them to repurchase the shares to conclude the deal. The spike caused by this purchase is short-lived.
Apple lost 2.7%, pushing shares into bear market territory and down 22% from a 52-week high. Meanwhile, Amazon and Meta shares closed more than 1%.
Shares of Disney plunged to a two-year low, but closed at 0.9 percent, reducing its losses as the media outlet reported higher-than-expected growth in the number of direct subscribers, but warned of a coveted impact on the theme park business. In Asia.
These moves came as traders thought of the latest inflation data in the US. New PPI data, which measures prices at wholesale prices, has risen 11% year-on-year.
On Wednesday, the US government released its latest reading of its consumer price index, which rose 8.3% year-on-year in April. This is higher than economists expected and is close to 8.5%, the lowest level in 40 years.

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Nadia Barnett
Nadia Barnett
"Award-winning beer geek. Extreme coffeeaholic. Introvert. Avid travel specialist. Hipster-friendly communicator."

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