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Wall Street closes sharply lower on Amazon slump, inflation worries

Published 04/29/2022, 07:43 AM
Updated 04/29/2022, 07:05 PM
© Reuters. FILE PHOTO: Traders work on the floor of the New York Stock Exchange (NYSE) in New York City, U.S., April 4, 2022.  REUTERS/Brendan McDermid/File Photo

© Reuters. FILE PHOTO: Traders work on the floor of the New York Stock Exchange (NYSE) in New York City, U.S., April 4, 2022. REUTERS/Brendan McDermid/File Photo

By Bansari Mayur Kamdar and Noel Randewich

(Reuters) - Wall Street slid on Friday to its deepest daily losses since 2020, as Amazon slumped following a gloomy quarterly report, and as the biggest surge in monthly inflation since 2005 spooked investors already worried about rising interest rates.

Amazon.com Inc (NASDAQ:AMZN) tumbled 14.05% in its steepest one-day drop since 2006, leaving the widely held stock near two-year lows. Late on Thursday, the e-commerce giant delivered a disappointing quarter and outlook, swamped by higher costs.

Apple Inc (NASDAQ:AAPL), the world's most valuable company, dropped 3.66% after its disappointing outlook overshadowed record quarterly profit and sales.

All 11 S&P 500 sector indexes fell, led lower by a 5.9% slide in Consumer Discretionary and a 4.9% drop in Real Estate.

The S&P 500 logged it largest one-day decline since June 2020. The Nasdaq's decline was its largest since September 2020.

Downbeat results and worries about aggressive monetary policy tightening by the Federal Reserve have hammered megacap technology and growth stocks this month.

The Fed is set to meet next week, with traders betting on a 50-basis-point rate hike to combat surging inflation.

Ahead of the weekend and the Fed meeting next week, "people are clearing the decks. The disappointing guidance from Apple and Amazon and a few other companies set the stage yesterday for today to be weak and it accelerated as we ended out the day," said Peter Tuz, President of Chase Investment Counsel in Charlottesville, Virginia.

The Nasdaq has lost about 13% in April, its worst monthly performance since the global financial crisis in 2008.

The S&P 500 has fallen 13% so far in 2022, its steepest four-month decline to start any year since 1939.

Adding to fears on Wall Street, data showed the personal consumption expenditures price index - the Fed's favored measure of inflation - shot up 0.9% in March after climbing 0.5% in February.

Signs of aggressive monetary policy tightening, the Ukraine war and China's COVID lockdowns have fueled fears of an economic slowdown. Data on Thursday showed the U.S. economy unexpectedly contracted in the first quarter.

The, S&P 500 declined 3.63% to end the session at 4,131.93 points.

The Nasdaq declined 4.17% to 12,334.64 points, while Dow Jones Industrial Average declined 2.77% to 32,977.21 points.

For the week, the S&P 500 lost 3.3%, the Nasdaq shed 3.9% and the Dow declined 2.5%.

GRAPHIC: S&P 500's busiest trades https://fingfx.thomsonreuters.com/gfx/mkt/gkvlgkajxpb/SPX_by_busiest_trades.png

The S&P 500 has gained or lost 2% or more in a day some 33 times so far in 2022, compared to 24 such days in all of 2021.

Exxon Mobil Corp (NYSE:XOM) slipped 2.24% after it took a $3.4 billion writedown due to its exit from Russia. Chevron Corp (NYSE:CVX) dropped 3.16% after its first-quarter profit underwhelmed.

The first-quarter earnings season overall has been better than expected so far. Nearly half of the S&P 500 companies have reported through Thursday and 81% of them have topped Wall Street's expectations. Typically, only 66% beat estimates, according to Refinitiv data.

Declining issues outnumbered advancing ones on the NYSE by a 3.91-to-1 ratio; on Nasdaq, a 2.85-to-1 ratio favored decliners.

The S&P 500 posted 2 new 52-week highs and 47 new lows; the Nasdaq Composite recorded 13 new highs and 385 new lows.

© Reuters. FILE PHOTO: Traders work on the floor of the New York Stock Exchange (NYSE) in New York City, U.S., April 4, 2022.  REUTERS/Brendan McDermid/File Photo

Volume on U.S. exchanges was 12.4 billion shares, compared with an 11.8 billion average over the last 20 trading days.

(This story corrects 10th paragraph to show S&P 500 YTD decline comparable to 1939, not 1932)

Latest comments

bubbles breaking not so big income all USA
inflation amzn appl are not NEW news, keep looping keep looping...just a bunch of bs
so when there's a rally is inflation not a issue then? 🤣🤣 inflation ain't going no where but higher.
Are there still people falling for dj trump? LOL. He recently acknowledge he lost the election. -- Any1 read the book 'Dark Towers: Deutsche Bank, Donald Trump, and an Epic Trail of Destruction,'?
Why is the stock market called Wall Street ? I would rename Wall Street to Worries! What they are doing on Wall Street is pure nonsense
Our government officials need to stop spending money like it grows on trees. That would certainly help things.
It drops because next week is the monthly Fed rates announcement.
not exactly Gary, it went down, up, down
think about it. When the market drops , it never really gets back the losses. Take yesterday for example . The S&P 500 gained 103.54( sounds great ) . But today it has lost(( -155.74)). So thats what i mean by a free-fall. Its dropping at a high rate overall. So most investor’s arent really making much , ((if any)) Money.
ok chart tells the same thing...
It aint apple and Amazon… it’s GDP and -10.9 percent in consumer disposable income!!! The Fed made a gigantic greed fueld mess
Here come savvy "investors" to "buy" the most grossly overvalued equities in history "in late trade," on a Friday, so they can hold over the weekend.  Not a profit taker to be found during yesterdays criminally manufactured "rally," yet out of the woodwork they come to "buy the dip."  Biggest investment JOKE in the world.  How much of the loss will magically vanish into thin air today?
Wrong again
Yeah I mean Amazon is down like 30% in the last month
  He said ' "in late trade," on a Friday', not about 'the last month'.   And market in downtrend AFTER he said here comes buyers.
Oversold territory.
J&J will release all the blood. That's what it looks like for now.
Many ppl in this world was sanction U$ products and services!!!
happy
Aapl Sales Way down, Once people realized they make the Back of all their new phones out of Glass, and they do Not stand behind their warranty or their Product, even if it's less than a Week old
Your $1,000 Investment is Garbage. Let's not even Talk about all their products, how they're made out of Slave Labor in Xinjiang and Apple doesn't Pay U.S. Taxes
less income liers SEC FED Bloomberg, Reutters, Munger, Wallstreet journal , Seeking Alpha, Fool UK, CNBC, etc.. all we dokumented, covid fraud is the best isn't it? Puting dirt to China buy it cheapest and takeover Chines and other markets.
its all FUD and fear is *****markets.
Apple gets many components from Foxconn. Foxconn built a massive facility in Wisconsin a few years back, but really haven't done much with it. I'd like to know why Apple doesn't put pressure on them to ramp up domestic production , thus controlling supply chain issues.
My point was that Foxconn has a U.S. based facility. Use It!!
how about raw materials? bring massive amount from china, build, and waste extras in US? good luck wi
 They Apple Prefers to use official Slave Labor (cheaper) ;)
Let the miracle begin in the biggest investment JOKE on earth.
So...today is greedy hedge fund take day ...last day of the month, they already lost millions why not take more off the top. Why not? It's not their money IT'S YOIRS.
Apple earnings didnt disappoint at all. Possible supply constraints are the concern.....like theyve been for a year now, yet most companies always seem to find a way around it. Sounds like an organized scam of the retail investor to me
I’ve been wondering the same thing
then you can pay 30pe for apple and sleep on that well-earned money, lmao
Xin Zhang  I'm not entirely sure what your point is? pe's have been Shown time-and-time to be Altogether Irrelevant as Research Shows  Particularly with growth stocks. Are you trying to say that the multiple is quite Lofty, and we should Keep our finger on the Trigger, with this one? 30 is not entirely Low, but it's not entirely High, either, That's If, of course pe's Really matter, or make that much of a difference, One-way-or-the-other.
No More Profit, No More Growth
Sales Slowed-dramatically because of All the ethics Issues, Surrounding Apple.
hiilve
hi
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