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S&P 500 and Nasdaq fall as growth stocks come under pressure from higher bond rates | Bollyinside


Wall Street was mixed on Thursday at the end of a shortened holiday week. Rising 10-year Treasury yields weighed on growth stocks, pushing the S&P 500 and Nasdaq into negative territory, while industrials and healthcare Stocks kept the Dow in positive territory. “High P/E multiples tend to fall when rates rise,” said Joseph Sloka, chief investment officer at Novapoint in Atlanta.

Four major U.S. banks kick off first-quarter earnings season, Goldman Sachs Group Inc., Citigroup, Morgan Stanley and Wells Fargo all reported financial results. All four companies beat Street’s estimates, but also reported a sharp drop in revenue. Their share prices have responded mixedly, ranging from 1% up (Citigroup) to 5% down (Wells Fargo) in recent times. The broader S&P 500 financial index fell 0.7%.

“With growing concerns that the Fed’s actions could push the economy into recession, investors are likely to put a moratorium on holding high-growth, high-value stocks. friday bank he holiday. “(Investors) may be risk averse because you never know what will happen over the three-day weekend, but I don’t think that’s the case right now,” Sloka added. “People are positioning for next week’s earnings.”

A number of economic data showed that the rise in gasoline prices exceeded the consensus in retail sales, causing the largest increase in import prices in nearly 11 years. The data is in line with other recent data that should support the Federal Reserve’s aggressive inflation policy in the coming months, including a series of 50 basis point rate hikes. Tesla Chairman Elon Musk has proposed privatizing Twitter for $41 billion in cash. Shares of social media companies have been volatile and have recently fallen nominally.

Analysts now expect the S&P 500 to grow at 6.3% for the full year, which is less optimistic than the 7.5% growth forecast at the beginning of the year. Issuance declines outpaced the NYSE by a ratio of 1.34 to 1. The Nasdaq favored the relegated by a ratio of 1.80 to 1. The S&P 500 has made 31 52-week highs and 9 lows. The Nasdaq Composite posted 51 new highs and 179 new lows.

The Dow Jones Industrial Average rose 116.68 points (0.34%) to 34,681.27, the S&P 500 fell 19.89 points (0.45%) to 4,426.7, and the Nasdaq Composite fell 172.67 points (1.27%) to 13,470.92. Among the 11 major sectors of the S&P 500, technology stocks were the worst performers. The first quarter earnings season is just beginning and the S&P 500 report includes 34 companies.

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