US stocks fluctuated on Thursday amid growing fears of an economic slowdown that has sent investors into the havens of government bonds.
The S&P 500 index recently gained about 0.1%, although it is still close to Bear Market District—The market is shortened to a 20% drop from a recent high. Indicator down 4% Wednesdaythe biggest one-day decline since June 2020. After this drop, the S&P 500 Index appeared fell more than 18% from its highest level ever in January.
The Dow Jones Industrial Average was down about 0.5% on Thursday, putting it roughly 15% below its all-time closing high. The Nasdaq Composite Index, which Entered a bear market area Earlier this year, they pared early losses and were recently up about 1%.
Investors have bought government bonds, which are seen as safe haven assets in times of economic uncertainty. return on 10-year treasury bonds It fell to 2.835% from 2.884% Wednesday. Thursday’s move put yields, which have risen for most of the year as the Federal Reserve began raising interest rates, on track to decline for seven of the last nine trading days. Bond yields and prices move in opposite directions.
Gained 3.9% after saying Sales doubled in Aprilmaking them the latest retailers to point to inflationary pressures on demand.
He said this week High costs ate profits In the last quarter, which led to the sale of their shares on a larger scale in the market.
Earnings reports from some of America’s largest retailers in recent days have added to concern that the highest rate of inflation in four decades is catching up to American consumers. Economy into recession. Investors were already struggling with the end of an era of loose monetary policy that underpinned big gains for stocks and other riskier assets.
Anthony Saglimpin, global markets analyst at Ameriprise Financial, said economic data pointed to healthy consumer spending, allaying fears of a recession.
“For consumers to really cut back on spending, they have to be afraid that they are going to lose their jobs and this is not the environment in which we live,” said Mr. Saglimpin.
However, some analysts say the slowdown in consumer spending could mean the Fed won’t have to raise interest rates aggressively to slash consumer demand.
“Some amount of deceleration in discretionary spending will naturally or naturally help ease supply chain constraints,” said Seth Wonder, chief investment officer at Acorns. “At the end of the day, this is one of the biggest inputs to the inflation issues we face.”
In economic news, the Ministry of Labor said new applications for unemployment benefits rose for the third week in a row. Initial jobless claims, a proxy for layoffs, remain historically low. Separately, US home prices Reached a new level in AprilAccording to recent data, the number of sales has decreased.
The war in ukraine It adds to the inflationary pressures that is driving the Fed to embark on a series of interest rate increases and reduce its bond holdings. The Covid-19 lockdown in China has led to a sharp slowdown in the world’s second-largest economy.
Cisco Systems It fell 14% after the telecom equipment company missed analyst expectations for its quarterly results.
She said gasoline sales boosted revenue and earnings in the first quarter, sending shares up 10%.
“The critical point here is how earnings hold up,” said Desmond Lawrence, senior investment analyst at State Street Global Advisors. “We are in a very turbulent time, so we expect more volatility.”
The combination of factors led to huge losses in stocks and some corporate bonds, and many investors expect the volatility to continue. Philip Saunders, portfolio manager at
Asset Manager based in UK and South Africa.
The last time the S&P 500 fell into a bear market was during the pandemic panic in March 2020. It was short-lived, and the market quickly started a two-year rally and peaked on January 3. Weighted by old industrial companies and bank stocks, it performed less poorly and is still far from bear market territory.
“By tightening monetary policy in the mix, we have a recipe for volatility and investor nervousness,” said Clara Cheung, global market analyst at JPMorgan Asset Management.
In energy markets, global oil benchmark Brent crude rose 1.2% to $110.43 a barrel.
International stocks fell, tracking the sell-off in the United States. The Stoxx Europe 600 Index fell 1.4%, led by shares of financial services and food and beverage companies. Hong Kong’s Hang Seng fell 2.5% as Tencent shares fell 6.5% after the video game giant reported a decline. Worst quarterly profit decline Since listing in the city.
Among individual European stocks,
It lost 1.2% after credit rating agency Fitch lowered the bank’s credit rating to BBB+. Swiss private bank Julius Baer Gruppe fell 6.7% after it said its assets under management fell in the first four months of the year.
Elsewhere in Asia, the CSI 300 of the largest stocks listed in Shanghai and Shenzhen rose 0.2%. Japan’s Nikkei 225 fell 1.9% and South Korea’s Kospi Composite fell 1.3%.
– Dave Sebastian contributed to this article.
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