Thursday (25) Inflation concerns prompted the ten-year U.S. bond yield intraday breakthrough 1.6%, technology stocks were a collective sell-off, Alphabet, Facebook and Apple fell more than 3%, TSMC ADR collapse of nearly 5%, that refers to a heavy drop of 3.52% to create the largest single-day decline in four months, the fee and a half index plunged nearly 6%.
Thursday (25) the performance of the four major U.S. stock indices.
The U.S. Dow Jones fell 559.85 points, or 1.75%, to close at 31,402.01 points.
The S&P 500 index fell 95.20 points, or 2.43%, to close at 3,830.23 points.
The Nasdaq fell 478.54 points, or 3.52%, to close at 13,119.43.
The Philadelphia Semiconductor Index fell 184.58 points, or 5.80 percent, to close at 2,999.16.
The S&P 11 sectors were in a sea of blood, with non-essential consumer goods, information technology and communication services leading the decline. (Photo: finviz)
Focus on individual stocks
All five major technology companies fell. Apple (AAPL-US) fell 3.48%; Facebook (FB-US) fell 3.64%; Alphabet (GOOGL-US) fell 3.26%; Amazon (AMZN-US) fell 3.24%; Microsoft (MSFT-US) fell 2.37%.
Dow Jones led the decline with Boeing. Boeing (BA-US) plunged 5.62%; salesforce (CRM-US) fell 3.90%; disney (DIS-US) fell 3.31%; Dow Chemical (DOW-US) fell 2.60%; Visa (V-US) fell 2.59%.
The fee-and-a-half component stocks are in a disaster situation. Applied Materials (AMAT-US) plunged 7.23%; NVIDIA (NVDA-US) plunged 8.22%; AMD (AMD-US) plunged 5.20%; Intel (INTC-US) fell 4.42%; Qualcomm (QCOM-US) fell 3.95%; Micron (MU-US) fell 4.76%.
Only Chunghwa Telecom was the only strong ADR in Taiwan. TSMC ADR (TSM-US) down 4.76%; NLM ADR (ASX-US) down 4.05%; UMC ADR (UMC-US) down 3.28%; Chunghwa Telecom ADR (CHT-US) up 0.38%.
Individual stock news
Nvidia (NVDA-US) announced its latest earnings report on Wednesday, benefiting from gaming and data center revenue, Q4 FY2021 revenue and EPS were both better than expected, and Q1 earnings were also strong, but its shares closed 8.22% lower to $532.30 per share due to bearishness on cryptocurrency business.
GameStop (GME-US) surged 103.94% on Wednesday before GameStop rose several times on Thursday, closing up 18.57% to 108.73 per share.
Twitter (Twitter) announced a goal of at least doubling revenue and 315 million daily active users by the end of 2023, Twitter rose more than 10% at one point during the day on Thursday, closing 3.71% in the red to $74.59 per share.
Beyond Meat (BYND-US) fell 5.46% on Thursday. The company announced multi-year supply agreements with McDonald’s (MCD-US) and Yum!
Economic Data
U.S. initial jobless claims last week (2/20) were reported at 730,000 vs. 825,000 expected, with the previous value revised down to 841,000 from 861,000
Last week’s (2/13) continuing jobless claims were 4.419 million, compared with 4.460 million expected, and the previous value was revised upward to 4.52 million from 4.494 million.
U.S. January preliminary monthly growth rate of durable goods orders reported 3.4%, expected 1.3%, the previous value of 0.5%
U.S. Q4 core PCE annualized growth rate revised to 1.4%, revised up from 1.4% to 3.4%
U.S. Q4 substantive GDP growth revised to 4.1% q/q, 4.1% expected, 4.0% prior
Wall Street Analysis
Ryan Detrick, chief market strategist at LPL Financial, said, “It’s all about the bond yield today.”
Ryan Detrick said: “The 10-year U.S. bond yield spiked, disrupting the Apple trend, as higher yield rates panicked the stock market. Will inflation be worse than will it appear than most people think? While the Federal Reserve is not worried about this, the market may be.”
Evercore ISI strategist Dennis DeBusschere analyzed, “The total collapse of the bond market. That way, all other news is ignored and the bond market has a lightning-fast swing, with the 10-year yield (at one point) pushing to 1.6%, and we have to wait for the bond market to reach some sort of equilibrium.”
Edward Moya, senior market analyst at foreign exchange broker Oanda, said, “U.S. stocks will continue to closely monitor the movement of U.S. bond yield, that index will continue to lead the decline, while some investors will tend to turn to REITs, consumer discretionary stocks, financial and utility stocks, etc.”
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