Stock Market Today: Wall Street Lays an Egg Heading Into Easter Weekend

Stocks fell across the board at the holiday-shortened trading week's conclusion as mixed bank earnings and cloudy economic data dampened bulls' enthusiasm.

The Commerce Department on Thursday reported that while retail sales did indeed grow for the third consecutive month, inflation clearly took a bite. March's retail sales were up 0.5% month-over-month, a slowdown from February's upwardly revised 0.8% growth and lower than expectations for 0.6% expansion.

"There's no doubt rising energy and gas prices are starting to take a toll on household budgets," says Peter Essele, head of portfolio management for Commonwealth Financial Network. "March's report could be an early sign that consumers are starting to put away their wallets as prices for many goods soar across the board."

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Also Thursday, the Labor Department said initial jobless claims for the week ending April 9 climbed a bit from the prior week, to 185,000 from 167,000 (revised), which was well more than the 170,000 expected.

Meanwhile, the first-quarter earnings season continued its debut with a mixed slate of reports from the nation's largest financial-sector firms.

Wells Fargo (WFC, -4.5%) stumbled hard as a decline in mortgage lending caused its Q1 revenues to come up short of Wall Street's mark; profits were better than expected but still were off 21% year-over-year.

Morgan Stanley's (MS, +0.8%) earnings were off 8%, but the stock was slightly in the green as a blowout quarter for its trading desks fueled easy top- and bottom-line beats. Similar success in Goldman Sachs (GS, -0.1%) and Citigroup's (C, +1.6%) trading divisions helped them easily hurdle earnings expectations, though both suffered 40%-plus declines in profits.

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And super-regional bank U.S. Bancorp (USB, +4.2%) was one of the sector's top performers after besting Q1 estimates, though here too, earnings were off from year-ago levels.

"This looks like a case where the banks underpromised and overdelivered as a way of putting lipstick on a very unattractive quarter," says Anthony Denier, CEO of trading platform Webull. "Overall earnings were terrible, but because they led analysts to believe their earnings would be worse, investors were happy."

Even Twitter (TWTR, -1.7%) managed to fall despite explosive M&A news. Just more than a week after it was reported that Tesla (TSLA, -3.7%) CEO Elon Musk had built up a 9%-plus stake in the social media platform, a new filing revealed that Musk is trying to buy Twitter outright for $54.20 per share.

The Nasdaq Composite took the worst brunt, off 2.1% to 13,351, good for a 2.6% weekly decline. The S&P 500 (-1.2% to 4,392) was down 2.2% for the week, and the Dow Jones Industrial Average's modest 0.3% dip to 34,451 cemented a 0.8% weekly loss.

And a quick reminder: Tomorrow (Good Friday) is a stock market holiday.

Other news in the stock market today:

• The small-cap Russell 2000 shed another 1% to 2,004, putting the index ahead by 0.5% for the week.
• U.S. crude oil futures jumped 2.6% to finish at $106.95 per barrel.
• Gold futures snapped their five-day winning streak, slipping 0.5% to settle at $1,974.90 an ounce.
• Bitcoin dropped back below the $40,000 mark, declining 3.1% to $39,782.41. (Bitcoin trades 24 hours a day; prices reported here are as of 4 p.m.
• Susquehanna Financial Group analyst Mehdi Hosseini downgraded Seagate Technology (STX, -3.2%) to Negative (Sell), saying quarterly cloud spending may peak in the second half of this year. This will likely be followed by relatively weaker spend trends into 2023, the analyst adds. While some of this is already priced, Hosseini argues "the extent of deceleration in cloud capex spend by year-end 2022 and into 2023, and its impact, is still not dialed into expectations and certainly not in the current consensus.. The analyst also downgraded fellow tech stock Western Digital (WDC, -3.2%), to Neutral (Hold).
• Nike (NKE) was the best Dow Jones stock today, gaining 4.7% after UBS Global Research analyst Jay Sole (Buy) said he was "very bullish" on the blue chip. "Nike will be a long-term outperformer, in our view," Sole says. "The company's investments in product innovation, supply chain speed, and digital are unlocking what is likely a multiyear period of above average growth. We forecast a 16% four-year earnings per share compound annual growth rate."

How Do You Fight Off Rising Prices? With Pricing Power!

Earlier this week, consumer and producer price reports alike showed that U.S. inflation is still in a full-blown sprint. That has Wall Street strategists continuing to look for stocks that can stave off inflation.

UBS's analyst team has just taken a look into pricing power, a company's ability to raise prices without significantly reducing demand.

"With inflation pressures surging, pricing power relative to cost exposures will be a key theme and source of alpha for global equity markets," says UBS's team. "Historically, when the U.S. two-year inflation breakeven has been above 2.5%, companies with strong pricing power have outperformed their weak counterparts by nearly 14% on average over the next 12 months."

UBS goes on to highlight a number of U.S. and international stocks that boast strong pricing power – as well as some names that come up short and could struggle as long as inflation remains hot. Read on as we explain more about this tactic for tackling inflation and look at UBS's winners and losers.