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Wall Street Turns Choppy After Higher Opening; Nasdaq Flat, Dow Down 270 Pts

Stock MarketsFeb 26, 2021 09:48AM ET
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© Reuters.

By Geoffrey Smith 

Investing.com -- U.S. stock markets were choppy in early trade on Friday, reversing early gains after economic data that showed no meaningful increase in short-term inflation pressures.

The price index for U.S. personal consumer expenditures, the Federal Reserve’s preferred measure of inflation, just a fraction above expectations in January. In year-on-year terms, it remains at a historically low level of 1.5% growth.

The figures sparked something of a rotation back into growth names over value ones, a reversal of the trend seen over most of the week. However, selling quickly returned to the fore as the University of Michigan's consumer sentiment index slumped to a six-month low.

By 10 AM ET (1440 GMT), the Dow Jones Industrial Average was down 273 points, or 0.9%, while the S&P 500 was up 0.3% and the Nasdaq Composite, which has borne the brunt of the week’s selling, was flat, completely reversing an early gain of 1.3%.

Separately, Tesla Inc (NASDAQ:TSLA) stock lost another 1.2% after Bloomberg data showed outflows of over $500 million from fund manager Cathie Wood's suite of ARK funds which have invested heavily in Tesla, Bitcoin and other names synonymous with the tech-focused rally of the last year. The redemptions put pressure on ARK to liquidate some of its holdings. On Thursday, Bloomberg had reported on Thursday that Tesla had become the latest carmaker to be hit by a global shortage of semiconductors, temporarily idling its Fremont plant in California.

Salesforce (NYSE:CRM) stock also fell 4.3% after a disappointing outlook in the software provider's quarterly update late on Thursday.

Overall sentiment had been lifted at the start of the day by figures showing that personal income in January rose by 10%, above expectations for a figure of 9.5%, as a fresh round of stimulus payments approved in the dying days of the last Congress hit consumers' accounts.  The numbers indicated that the damage to household balance sheets from the surge in unemployment last year will be contained. Personal spending also increased, by a more restrained 2.5%.

The numbers come at the start of a day on which the House of Representatives is expected to vote on the Biden administration's $1.9 trillion stimulus package. One element that has been pulled from that package is the proposal for a $15/hour national minimum wage, which Senate officials said couldn't be decided under Budget Reconciliation provisions. That is now likely a dead letter, given the opposition from Republican Senators.

In other moves, Airbnb (NASDAQ:ABNB) stock rose 3.7% after its fourth-quarter update showed a faster-than-expected rebound in bookings, something it said expects to continue as the first phase of the travel sector's reopening benefits the private rental sector more than the hotel sector. Virgin Galactic stock slumped 14% after the space tourism company said it had delayed its next test flight until May, and DoorDash (NYSE:DASH) stock fell by 4.6% after it said it expected the reopening of restaurants nationwide to slow its growth in the coming months.

 

Wall Street Turns Choppy After Higher Opening; Nasdaq Flat, Dow Down 270 Pts
 

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Comments (15)
Mitchel Pioneer
Mitchel Pioneer Feb 26, 2021 12:44PM ET
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One after another, losses in the US Ponzi Scheme miraculously vanish from the system, as the predictable fraud continues. The US Ponzi Scheme is the greatest investment fraud in history, and laughingstock of the financial world.
Viking Fire
Viking Fire Feb 26, 2021 12:44PM ET
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Awe, not enough to invest cupcake?
Dr Gogu
Dr Gogu Feb 26, 2021 12:23PM ET
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Nasdaq very green as I predicted last night. There's a good chance the correction is over for Nasdaq as it was down almost 9%.
Max Rochester
Max Rochester Feb 26, 2021 12:23PM ET
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yep look at all the ips on the chart and it shows.. unless something cataphoric
Viking Fire
Viking Fire Feb 26, 2021 12:23PM ET
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Why do they call taking 10% of the cash and leaving everyone else as bag holders correction? Maybe if i see it go back in.
Steve Lora
Steve Lora Feb 26, 2021 11:43AM ET
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Biden in total chaos as is Cuomo and the old white dnc socialist party
CT OREN
CT OREN Feb 26, 2021 10:35AM ET
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Down down down. Lets pray for another market crash!
Jason Bourne
Jason Bourne Feb 26, 2021 10:35AM ET
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you ran out of meds?
VietAnh Tran
VietAnh Tran Feb 26, 2021 10:35AM ET
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Poor foong
All in Buffett Turtle
Turtle Feb 26, 2021 10:28AM ET
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Looking back on the past, the steep rise in U.S. government bond rates was bound to be a steep decline and regained calm. The reason why the interest rate on government bonds is rising in the Covid-19 situation around the world is that there are many cowards in the Wall Street market in the U.S.  For example, a private lender comes to collect debts, but if he or she doesn't pay back the debt, he or she will raise interest, so only then does he or she pay back the debt by selling everything he or she buys, including his or her car's household goods. However, if he had known that the interest on private loans was legally limited, he would never have done anything foolish. Therefore, raising interest rates on government bonds is nothing more than simply showing a taste in the market.
VietAnh Tran
VietAnh Tran Feb 26, 2021 10:28AM ET
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Emptypocket like you are hero lol
Stan Smith
Stan Smith Feb 26, 2021 10:28AM ET
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Bears Cheer???
Rodolfo Barraco
Rodolfo Barraco Feb 26, 2021 10:28AM ET
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Sure!
Inta Boon
Inta Boon Feb 26, 2021 10:09AM ET
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really good luck?
Doug Coen
Doug Coen Feb 26, 2021 10:08AM ET
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If you think inflation is low then you haven't tried to buy construction materials or food
Jasbir Singh
Jasbir Singh Feb 26, 2021 10:08AM ET
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In real, inflation is at peak levels.
Me comment
Me comment Feb 26, 2021 10:07AM ET
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And 20 minutes later it tanking fast
Andres Chung
Andres Chung Feb 26, 2021 10:06AM ET
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lol ********
habu walida
habu walida Feb 26, 2021 10:05AM ET
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good luck
Joey Stern
Joey Stern Feb 26, 2021 10:04AM ET
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Thanks for nothing
Cal Lowe
Cal Lowe Feb 26, 2021 9:59AM ET
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Amazon , tesla, alphabet, is the way to go. Time to buy
Leon Kelly
Leon Kelly Feb 26, 2021 9:56AM ET
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The smart money are just scalping. don't fall for the bull trap
Joey Joey
Joey Joey Feb 26, 2021 9:56AM ET
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This aged well
 
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