The Federal Reserve Board (Fed) warned that the U.S. economy is slowing down, Boeing and other disappointing earnings, speculative trading activity intensified, Wednesday (27) Panic Index soared more than 34%, the main index of U.S. stocks across the board down.
The Dow Jones Industrial Average fell 633.87 points or 2.05% to 30,303.17 points, the worst single-day trend since October 28. The Stamp 500 index fell 98.85 points or 2.57% to 3,750.77, erasing all gains since 2021 and is now down 0.1%. The Nasdaq Composite Index, dominated by technology stocks, fell 355.47 points or 2.61% to 13,270.6 points.
The Federal Reserve Board (Fed) announced on Wednesday that it left benchmark interest rates and the pace of asset purchases unchanged, warning that the U.S. economy is slowing and that the future path of the economy will depend not only on the new coronavirus (Chinese Communist virus) but also on the progress of vaccinations.
Fed Chairman Ball said at a press conference after the interest rate meeting beckoned that the scale of bond purchases will not be scaled back for some Time as the economic recovery slows.
U.S. President Joe Biden signed an executive order on climate change on Wednesday, intending to create the United States as the largest exporter of clean energy and lead global measures to address the climate change crisis.
Wednesday (27) the performance of the four major U.S. stock indices.
The U.S. Dow Jones fell 633.87 points, or 2.05%, to close at 30,303.17 points.
The S&P 500 index fell 96.42 points, or 2.50%, to close at 3,753.20 points.
The Nasdaq fell 355.47 points, or 2.61%, to close at 13,270.60.
The Philadelphia Semiconductor Index fell 156.64 points, or 5.17%, to close at 2,875.13.
Individual Stocks in Focus
Only Microsoft closed in the red among the five major technology players. Apple (AAPL-US) fell 0.77%; Facebook (FB-US) plunged 3.51%; Alphabet (GOOGL-US) fell 4.67%; Amazon (AMZN-US) fell 2.81%; Microsoft (MSFT-US) rose 0.25%.
Dow Jones component stocks a wretched. 3M (MMM-US) surged 6.13%; Walgreens United Boots (WBA-US) jumped 4.05%; Boeing (BA-US) fell 3.97%; Merck (MRK-US) fell 3.96%; McDonald’s (MCD-US) fell 3.89%.
AMD (AMD-US) plunged 6.13%; Intel (INTC-US) fell 2.93%; Micron (MU-US) plunged 5.56%; Applied Materials (AMAT-US) plunged 6.59%; Qualcomm (QCOM-US) plunged 5.46%; NVIDIA (NVDA-US) fell 3.85%.
Taiwan ADRs closed in the black simultaneously. TSMC ADR (TSM-US) fell 3.88%; UMC ADR (UMC-US) plunged 6.96%; Sunrise ADR (ASX-US) fell 4.34%; Chunghwa Telecom ADR (CHT-US) fell 0.15%.
Individual Stock News
Video game maker GameStop (GME-US) surged 134.84% to $347.51 per share on Wednesday, rising for five consecutive trading days under retail investors’ pursuit and short-covering.
White House spokeswoman Shaki (Jen Psaki) said the situation is being closely monitored by Biden’s economic team, including Yellen and other officials, but it’s a reminder that the stock market is not the only indicator of the health of our economy.
Global theater leader AMC Entertainment (AMC-US) opened with shares spraying more than 200% several times before closing with a jump of 301.21% to $19.90 per share.
This week ushered in the busiest earnings week, with Microsoft (MSFT-US) announcing after-hours earnings and Azure cloud revenue growth for the second quarter of fiscal year 2021 (ended 12/31) on Tuesday, both beating analysts’ expectations. Microsoft rose 0.25% to $232.90 per share.
Boeing (BA-US) shares fell 3.97% to $194.03 per share after it reported 4Q2020 revenue of $15.3 billion, a 15% annual decrease, but better than Wall Street expectations, and a net loss that widened to $8.4 billion, totaling a full-year net loss of more than $11.9 billion, before the bell Wednesday.
tesla (TSLA-US) fell 2.14 percent to $864.16 per share. Tesla reported its latest earnings after the bell on Wednesday, with net earnings per share (EPS) of $0.80, weaker than Wall Street’s expectations, and revenue of $10.74 billion, higher than Wall Street’s expectations, sending its shares down more than 4 percent after the bell.
Apple (AAPL-US) fell 0.77% to $142.06 per share on Wednesday, and its shares rose a modest 0.070% after-hours. Apple’s latest earnings report, released after the bell, easily exceeded analysts’ expectations, with revenue of $111.44 billion and net income of $1.68 per share, thanks to strong sales of iPhone 12.
Apple’s latest earnings report shines as strong iphone 12 sales push. (Photo: appleinsider)
Economic Data
U.S. durable goods orders rose at a preliminary monthly rate of 0.2% in December, compared to expectations of 1.0% and the previous value of 1.0%
Wall Street Analysis
John Davi, founder and CIO of Astoria Portfolio Advisors, mentioned that it is healthy profit-taking under the market’s record highs. Over the past two months, the market has seen a huge asset melt up. When the market is parabolic up, you will see a lot of speculation by investors.
Adam Crisafulli, founder of Vital Knowledge, said in a report that market participants are watching the GameStop phenomenon with curiosity and amusement, but the stock’s recent performance is eroding market confidence and creating some position misalignment.
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