December 1, 2022

Stocks plummet with Fed policy, earnings in focus

Stocks plummet with Fed policy, earnings in focus

Stocks lost ground on Tuesday, with another batch of earnings pouring in and investors awaiting the Federal Reserve policy and jobs data meeting later this week.

S&P 500 Index (^ Salafist Group for Preaching and Combat) is down about 0.23% in afternoon trading, while the Dow Jones Industrial Average is down (^ DJI) It decreased about 0.2%. Nasdaq Technology Heavy Vehicle (^ ninth) by 0.5%. The three indicators rose to start the session.

Investors digested economic data on Tuesday, including the Job Opportunity and Employment Turnover Survey (JOLTS), which found employment rose unexpectedly in September to 10.7 million from 10.28 million last month. Economists had expected openings to fall to around 10 million, which was in line with The kind of cooling the Fed wants to see in the labor market.

Meanwhile, the ISM manufacturing PMI for October fell to 50.2, while economists surveyed by Bloomberg estimated 50.0. The ISM industrial employment index rose to 50.0 from 48.7, as economists surveyed by Bloomberg estimated 53.0.

The stock moves came after the major indices I fell behind on Monday Investors are preparing for the Federal Reserve’s interest rate decision this week. Still, October stocks closed higher, with the Dow closing in its best monthly return since January 1976, when the index rose 14.2%, data from Bespoke Investment Group showed.

The frenetic pace of the Federal Reserve in raising interest rates has squeezed markets for most of the year, leaving investors hopeful for any sign that central bank He will depart from his hard line.

The Federal Reserve is widespread Expected to raise interest rates by 75 basis points on Wednesday at the conclusion of the two-day policy meeting, but some strategists see the bank slowing rate increases going forward.

Michael Feroli, chief economist at JPMorgan, sees “a decline from 75 basis points to 50 basis points and then to 25 basis points before this tightening cycle ends. And any indication from the Federal Reserve that that [the] The final interest rate is lower or the tightening cycle likely to end in 2022 [be] Digested upwards by the stock. The biggest risk to this view is that CPI will come out more than expected next week or in December.”

Whatever the size of the move in December, “the Fed is in a tough spot because it relies so heavily on data. It’s not clear how quickly inflation will drop,” said Lisa Erickson, head of the Public Markets Group. Yahoo Finance Live on Monday.

Also on top of earnings on Tuesday:

  • Uber (Uber): The passenger transport giant posted a file third quarter loss but Exceeded analyst estimates for revenue and showed an increase in bookings. Shares are up more than 14% in early trading.

  • Pfizer (PFE): pharmaceutical maker Posted better than expected It raised revenue forecasts for this year despite higher prices that offset sluggish demand for the COVID-19 vaccine outside the United States.

  • SoFi (Sufi): Digital Bank reported a lower-than-expected quarterly loss and revenue that beat analyst estimates. The fintech firm raised its guidance as the company added an additional 4.7 million customers by the end of the third quarter.

  • Eli Lilly and Company (LLY): pharmaceutical company beat the third quarter Outlook But it lowered its forecast for 2022, citing exchange rates and tax law.

  • Abiomed (ABMD): Small Heart Pumps Manufacturer Approved A Nearly 17 billion dollars Acquisition of Johnson & Johnson (JNJ) as the deal gives J&J exposure to a high-growth segment of medical technology.

Advanced Micro Devices (AMD) and Airbnb (ABNB), Mondelez (MDLZ) and Clorox (CLX) also to report on Tuesday.

The week will end with the October jobs report. The Labor Department report is expected to show monthly salaries drop below 200,000, while economists polled by Bloomberg estimated that 190,000 jobs were added or created last month.

In energy markets, Brent crude, the international benchmark for oil prices, fell to $94.36 a barrel on Tuesday morning. 10-year Treasury yields decreased as much as 12 basis points to less than 4% before rising again above that level later in the morning.

Shares of Chinese companies listed in the US including Alibaba (Baba) also rose on Tuesday as unconfirmed social media reports spread that the Chinese government may move towards undoing its tough policy on the coronavirus.

Elsewhere, the Toronto Stock Exchange Resume trading After a technical issue halted the market shortly after the opening on Tuesday.

Danny Romero is a reporter for Yahoo Finance. Follow her on Twitter Tweet embed

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