Thursday (18) the market suffered a double kill stocks and bonds! Ten-year U.S. bond yield soared, the panic index VIX surged, Crude Oil plunged, technology, energy stocks under pressure, financial stocks rose, tesla collapsed nearly 7%, the four major indices all black, that refers to a heavy drop of more than 3%, the worst single-day performance since February 25.
Thursday (18) the performance of the four major U.S. stock indices.
U.S. Dow Jones fell 153.07 points, or 0.46%, to close at 32,862.30 points.
The S&P 500 index fell 58.66 points, or 1.48%, to close at 3,915.46 points.
The Nasdaq fell 409.03 points, or 3.02%, to close at 13,116.17.
The Philadelphia Semiconductor Index fell 131.70 points, or 4.24%, to close at 2,976.22 points.
Only financials closed in the red in the S&P’s 11 major sectors, with energy, information technology and non-essential consumer goods leading the decline.
Individual Stocks in Focus
The top five technology companies all fell. Apple (AAPL-US) fell 3.39%; Facebook (FB-US) fell 1.90%; Alphabet (GOOGL-US) fell 2.92%; Amazon (AMZN-US) fell 3.44%; Microsoft (MSFT-US) fell 2.67%.
Dow Jones components closed mostly in the black. Chevron (CVX-US) fell 3.62%; Boeing (BA-US) fell 2.86%; Microsoft (MSFT-US) fell 2.67%; Dow Chemical (DOW-US) fell 0.46%; salesforce (CRM-US) fell 1.66%.
Fee and a half components were the hardest hit. Micron (MU-US) down 5.21%; AMD (AMD-US) down 5.46%; Intel (INTC-US) down 3.12%; Applied Materials (AMAT-US) down 4.69%; NVIDIA (NVDA-US) down 4.64%; Qualcomm (QCOM-US) down 3.11%.
Taiwan ADRs declined collectively. TSMC ADR (TSM-US) down 3.55%; NLM ADR (ASX-US) down 0.27%; UMC ADR (UMC-US) down 4.52%; Chunghwa Telecom ADR (CHT-US) down 0.82%.
Stock News
Long-dated U.S. bond yield rose strongly as technology stocks and other growth stocks became less attractive. Tesla (TSLA-US) plunged 6.93% to $653.16 per share. Apple (AAPL-US) fell 3.39% to $120.53 per share.
The European Medicines Agency investigated that the Astellicam vaccine is still safe and effective, and France, Germany, Italy, the Netherlands, Portugal and Spain resumed using the vaccine. Astellicom (AZN-US) fell 1.48% to $49.33 per share.
U.S. memory chip maker Micron Technology halts 3D XPoint R&D work and sells a fab in Lehi, Utah. Micron (MU-US) plunged 5.21%.
FedEx (FDX-US) fell 0.88% on Thursday, despite a better-than-expected profit on FedEx’s latest earnings report, with net income per share and sales growth accelerating for the third consecutive quarter.
Global theater leader AMC Entertainment (AMC-US) rose 3.24%. The company announced that 98% of its U.S. theaters will reopen as of this Friday.
Economic Data
U.S. initial jobless claims were reported at 770,000 last week (3/13), compared to 700,000 expected and 725,000 previously revised up from 712,000.
Last week’s (3/6) continuing jobless claims were 4.124 million, compared with 4.034 million expected and 4.144 million revised down to 4.142 million.
March Philadelphia Fed Manufacturing Index at 51.8, expected 23.0, previous 23.1
Wall Street Analysis
Craig Johnson, Technology Market Strategist at Piper Sandler, said, “The risk of a too-rapid rise in U.S. bond yield rates remains a major concern for the market, with growth stocks lagging the broader market over the past few weeks due to headwinds from higher yield rates and unequal buying pressure.”
Matt Maley, chief market strategist at Miller Tabak, said, “At a Time of heightened Inflation concerns, the Fed’s stated willingness to let inflation heat up is another way of signaling a willingness to let long-dated U.S. bond yield rise further.”
Wells Fargo expects, “Economic growth and oil demand will provide resilience and OPEC+- to ease their production restrictions in the coming months. Over time, these additional barrels could become a headwind for oil prices.”
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