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Wall Street closes sharply lower on Amazon slump, inflation worries

Stock Markets Apr 29, 2022 07:05PM ET
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© 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.

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)

Wall Street closes sharply lower on Amazon slump, inflation worries
 

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Comments (26)
Chad Richer Than You
Chad Richer Than You Apr 30, 2022 5:06AM ET
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West haters with broken English have dominated this platform.
We Fi
We Fi Apr 30, 2022 2:30AM ET
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bubbles breaking not so big income all USA
dav lo
dav lo Apr 29, 2022 11:52PM ET
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inflation amzn appl are not NEW news, keep looping keep looping...just a bunch of bs
Jose Cabreja
Jose Cabreja Apr 29, 2022 9:41PM ET
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so when there's a rally is inflation not a issue then? 🤣🤣 inflation ain't going no where but higher.
Chris Sundo
Chris Sundo Apr 29, 2022 8:56PM ET
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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,'?
Jamie An
Jamie An Apr 29, 2022 5:01PM ET
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US market is like a drug addict, can't stand without heloin that named low rates and qe. Now doctor have to cut it from US market or she will be ill very seriously. Recession.
Hani Taher
Hani Taher Apr 29, 2022 4:18PM ET
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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
Jamie An
Jamie An Apr 29, 2022 3:52PM ET
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FR made huge mistake and let the inflation went up in last year. Next week Powell should give very very clear message to the market, otherwise key interest need to be 5~6% in end of this year. Shock and Fear is coming soon but it's nothing.
Minky Morbius
Minky Apr 29, 2022 2:56PM ET
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Our government officials need to stop spending money like it grows on trees. That would certainly help things.
Mauricio V.
Mauricio V. Apr 29, 2022 2:28PM ET
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It drops because next week is the monthly Fed rates announcement.
Gary Moses
Gary Moses Apr 29, 2022 2:28PM ET
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You certainly have a point. , but to be honest, the Market has been in a FREE-FALL every-since the invasion Started.
Meru Pet
Meru Pet Apr 29, 2022 2:28PM ET
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not exactly Gary, it went down, up, down
Gary Moses
Gary Moses Apr 29, 2022 2:28PM ET
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Meru Pet 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.
Meru Pet
Meru Pet Apr 29, 2022 2:28PM ET
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ok chart tells the same thing...
 
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