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Stock Market Today: Dow snaps win streak as profit taking triggers sharp reversal

Published 12/20/2023, 06:38 AM
Updated 12/20/2023, 04:15 PM
© Reuters

Investing.com -- The Dow closed lower Wednesday, snapping a nine-day winning streak amid a sharp reversal Wednesday as investors appeared to take some profit on the weeks-long rally seen in stocks.

By 16:00 ET (21:00 GMT), the Dow Jones Industrial Average fell 475 points, or 1.3%, the S&P 500 fell 1.58%, and the NASDAQ Composite fell 1.5%.  

Profit taking creeps into markets

Investors took profit on the rally in markets that pushed the Dow to all-time highs and the S&P 500 within touching distance of its all-time high, triggering the broadest selloff in markets since March.  

Stocks were in the green intraday following signs of consumer strength and pick up in housing activity. 

The confidence index from the Conference Board jumped to a reading of 110.7,  the highest level since July 2023 and and the second highest level in the last 2 years, driven by "labor market optimism as well as some additional relief on inflation," Jefferies said in a note.

U.S.existing home sales unexpectedly picked up pace in November to to a six-month high from the prior month to a seasonally adjusted annual rate of 1.56 million units. Economists were expecting a 0.6% increase to 5.44 million homes. The move comes just as data showed 30-year mortgage rates fell to the lowest level since June.

Weak guidance sees FedEx slump; General Mills falls on guidance cut

That said, investors appear to be taking a breather from this lengthy rally as they digest disappointing news from FedEx (NYSE:FDX), widely seen as a bellwether for the U.S. economy as it tends to indicate strength, or weakness, in consumer spending.

The parcel delivery firm stock fell 12% after it slashed its full-year revenue guidance and posted weaker-than-anticipated quarterly profit, warning that customer demand will face headwinds from "volatile macroeconomic conditions" for the rest of its fiscal year, ending on May 31. 

The outlook hinted at weakness in typically robust holiday spending activity in the U.S., as consumers continue to cope with high inflation and elevated interest rates.

General Mills Inc (NYSE:GIS) lowered its annual sales forecast and missed second-quarter estimates as the food processor warned of a slower recovery in demand, sending its shares more than 3% lower. 

Alphabet reportedly considering ad-sales unit shake-up

Alphabet Inc Class A (NASDAQ:GOOGL) closed 1% higher, though well off session highs as the tech giant is reportedly mulling a plan to restructure its ad sales business by ramping up the use of automation including machine learning. 

Apple Inc (NASDAQ:AAPL), Meta Platforms Inc (NASDAQ:META), and Microsoft Corporation (NASDAQ:MSFT) gave up gains amid a broader market selloff to close below the flatline.

Warner Bros. Discovery (NASDAQ:WBD) in talks to merge with Paramount

Warner Bros. Discovery chief executive David Zaslav met with Paramount Global CEO Bob Bakish on Tuesday to discuss a possible merger, Axios reported, citing unnamed sources.

A potential merger could trigger further consolidations across the industry. 

(Peter Nurse contributed to this report.)

Latest comments

The end game of the debt bubble is here
the sky is falling, the sky is falling!
And it's gone again.
It's ok, good mood fundamental is back
Will bounce back quickly
permabears are excited..
The global economy is becoming more interconnected.
The gig economy is changing the nature of work.
like I said 3 days ago, time to cash out
You were wrong 2 days ago, yesterday & this morning.
 if I predict an recession every year, I would be right once every decade
'puters triggers got hit.  Dump!
Look at the P/E on Wingstop. Central banks created millions of the largest bubbles the world has ever seen. Look at price discovery on Carvana. Look at all the blatant fraud and stock buyback schemes. All of this is fraud.
The GOP has been fighting tax of stock buybacks.
Its all buybacks and artificial liquidity injections. Shameful what markets have become
There's going to be a ton of houses foreclosed in a few years
Textbook double top. Just like the 2000 tech bubble. The crash begins now.
That was a recovery after a crash due to Fed stimulus buddy
Now we're recovering from something else.
The pandemic stimulus payments have little/nada to do w/ the Fed Reserve.
Vanguard and Blackrock manipulating the market and taking profits. Rinse and repeat.
Why would you take profits when the market is on such an upward trajectory? Unless...
Go ahead, tell us the P/E of the market now versus 10 years ago and you will see just how massive of a depression is incoming, especially if China invades Taiwan during an election year (since people probably wont fall for COVID again).
Trillions of fake dollars injected into the economy since Biden took office, 50+ year high inflation, and the market cannot even hold 2021 levels. Bidenomics.
there was every indication that we could see a move higher today, but this sell off should be profit taking. unfortunately there's not quite enough signals to suggest a rally off today's low.tomorrow. be cautious and use stops...
Maybe fund managers are starting their holiday vacations and wanna lighten up before leaving.  Markets dipped in 2nd half of Dec 2022, too.
When reality bits fiction. An over inflated stock market made of speculation. Soon enough this insanity will have to face the fact that many may lose their lives savings because they missed the call before the boat sunk.
When's the last time "insanity ... have to face the fact"?
Die Pisser sollen ihren Schulden zurück zahlen,
Ja, ich stimme
Ist alles manipuliert von paar Big Boys, verantwortlich ist FED mit Virtuelle Geld
Genau
Stock mkt should be higher considering inflated numbers. 4700 in 2015 today would be 6000 S & P
It might interest you to know that inflation adjusted S&P is a thing you can actually look up if you are interested in factual accuracy. In today's dollars, the 2015 S&P would be equivalent to 2,670.06..
Retreat to the upside
Can't have a loss in greatest financial FRAUD in history, and biggest investment JOKE in the world, as Wall Street pins the throttles on their criminal manipulation.
loser, Mitch is at it again..
looser
loooooser
we had that small predictable correction,now it's off too the races to the end of the Year.
retreat? seriously? The market's still rising.
Technology stocks continue to perform well.
They're massively overvalued because theres nothing left to invest in
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