Stocks flipped sharply from green to red Thursday as interest-rate fears swelled again across Wall Street.
Federal Reserve Chair Jerome Powell sent the latest signal that the central bank's next rate hike might be soon, and bigger than usual. Powell told an International Monetary Fund panel that it's "appropriate in my view to be moving a little more quickly" to raise interest rates, adding, "I would say 50 basis points will be on the table for the May meeting."
The yield on the 10-year Treasury popped in response, from 2.836% to as high as 2.954%.
From just $107.88 $24.99 for Kiplinger Personal Finance
Be a smarter, better informed investor.
Sign up for Kiplinger’s Free Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
Initial jobless claims for the week ended April 16 came in at 184,000 – a bit higher for estimates for 182,000, but still historically low and under the previous week's revised 186,000.
"That said, employment metrics have taken a back seat to inflation and interest rate hikes, so the read today is unlikely to move the needle for the market," says Mike Loewengart, managing director of investment strategy for E*Trade.
Corporate earnings didn't do much to turn the tide. Tesla (TSLA, +3.2%) popped after it reported a record $3.3 billion overall profit and easily beat analysts' consensus earnings estimates. So too did AT&T (T, +4.0%) despite missing on overall revenues; that said, core revenues related to its wireless business improved 2.5% in Q1.
But the major indexes didn't follow suit. Dips in communication services (-2.8%) and technology (-1.8%) weighed most on the Nasdaq Composite (-2.1% to 13,174), though the S&P 500 (-1.5% to 4,393) and Dow Jones Industrial Average (-1.1% to 34,792) sustained sizable declines, too.
Other news in the stock market today:
- The small-cap Russell 2000 slumped 2.3% to 1,991.
- U.S. crude oil futures finished off their highs but still improved by 1.6% to $103.79 per barrel.
- Gold futures slipped by 0.4%, settling at $1,948.20 per ounce.
- Bitcoin also shed more than all of its morning gains, declining marginally to $41,207.81. (Bitcoin trades 24 hours a day; prices reported here are as of 4 p.m.
- Carvana (CVNA) plummeted 10.1% after the online used car dealer reported a loss of $2.89 per share in its first quarter, wider than the $1.58 per-share loss analysts were expecting. The company beat on the top line, however, bringing in $3.5 billion versus a $3.4 billion consensus estimate. "Carvana is facing several industry-wide and company-specific headwinds that are impacting unit volumes and margins," says Stifel analyst Scott Devitt, who reiterated a Buy rating on CVNA stock. "While near-term trends are challenged, we believe the long-term thesis remains intact as the company continues to capture market share and develop the assets needed to realize significant leverage at scale."
- Airline stocks got a lift after positive earnings from United Airlines Holdings (UAL, +9.3%) and American Airlines Group (AAL, +3.8%). While United missed on both the top and bottom lines in its first quarter, the company said it expects to report its highest quarterly revenue and return to a profit in the second quarter. American also reported a wider per-share loss than analysts were expecting in its first quarter, but it beat on revenue and said it expects to post a pre-tax profit in the second quarter. CFRA Research analyst Colin Scarola maintained a Strong Buy rating on UAL, saying its shares are "materially undervalued." The analyst also kept a Hold rating on AAL. "Low efficiency, much higher debt, and a history of negative free cash flow in 2017-2019 leave us preferring AAL's peers to invest in the post-pandemic travel recovery," Scarola writes in a note.
The Market's Latest Ideas Are in Wall Street's Newest ETFs
Ever find yourself in an investment rut? Well, if you're looking for fresh investment strategies to tickle your brain cells, turn your eyes toward the exchange-traded fund (ETF) industry, where there's always something new.
Indeed, more than 100 ETFs have launched so far in 2022 as the industry sucks up an ever-growing gob of cash – globally, ETFs drew in $305.6 billion in net inflows during the first quarter, marking the second-highest total behind only Q1 2021's record $361.1 billion. That tally also follows 2021's record-breaking annual intake.
"Given back-to-back record-breaking calendar years of net inflows, it is less of a surprise that the supply of ETFs has expanded," says Todd Rosenbluth, head of research at ETF Trends.
Our core ETF recommendations, such as the Kip ETF 20 and the Best ETFs for 2022, are primarily built around established funds and seasoned with the occasional newcomer. But spanking-new ETFs, while unproven, are also worth keeping an eye on given that many of them tend to feature novel investment strategies, emerging industries or cheaper ways to accomplish traditional portfolio goals.
Read on as we highlight nine noteworthy new ETFs that have hit the market in 2022.
-
S&P 500 Slips Ahead of Fed Week: Stock Market TodayAll eyes are on the Federal Reserve ahead of next week's critical policy meeting.
-
September Fed Meeting: Live Updates and CommentaryThe September Fed meeting is a key economic event, with Wall Street keyed into what Fed Chair Powell & Co. will do about interest rates.
-
Dow Gains 617 Points as Rate Cuts Near: Stock Market TodayWednesday's economic data didn't shift Wall Street's expectations that the Fed is preparing for a rate cut at next week's meeting.
-
Hot August CPI Report Doesn't Shift the Rate-Cut Needle: What the Experts SayThe August CPI came in higher than forecast on a monthly basis, but Wall Street still expects a rate cut at next week's Fed meeting.
-
S&P 500 Hits New High After Oracle Earnings: Stock Market TodayAnother down day for Apple held the Dow Jones Industrial Average back, though.
-
Stocks Grind Up to New All-Time Highs: Stock Market TodayUnitedHealth stock led the Dow Jones Industrial Average amid increasing signs the labor market has not been well for months.
-
Markets Prepare for August Inflation Data: Stock Market TodayApple CEO Tim Cook is still important, but price action this week is as much about incoming inflation data ahead of next week's Fed meeting.
-
Stocks Slip as Job Growth Stalls: Stock Market TodayThe August jobs report came in much weaker than expected, while the unemployment rate ticked higher.
