Tough week for tech amid economic data and rising interest rates
IIt’s been a volatile week on Wall Street, with technology in the spotlight for most of it. On Monday, the Dow Jones Industrial Average (DJI) recorded its fourth consecutive loss, and the S&P 500 (SPX) its fifth, while the Nasdaq went into the black late in the day despite pressure from Big Tech. Rising interest rates were also on investors’ minds to start the week, however, all three major indexes brushed aside concerns to end the day higher on Tuesday and extended those gains into the next day. Analysts unpacked the consumer price index (CPI) midweek, which jumped 7% year-over-year, marking the biggest jump in nearly 40 years.
Shares fell further on Thursday, as the the sale of technology has returned. the producer price index (PPI) for December was lower than analysts’ estimates, but still marked a 9.7% year-over-year jump – the highest since 2010, while first weekly jobless claims for the past week came in at 30,000 above the 200,000 estimate. At this point on Friday, disappointing economic data and banking income weigh heavily on the market and all three major benchmarks are heading for weekly losses.
Earnings season kicks off
Earnings season is just beginning, with many quarterly reports still to come. Financial names have been the focus so far, with a sprinkling of other big names as well. We checked in with Black Rock (BLK), Procter and Gamble (PG) and Goldman Sachs (GS) before winnings. Wells Fargo (WFC) hit a three-year high after its up and down beats. In addition, KB Home (KBH) soared optimistic forecast, and Delta Air Lines (DAL) saw an influx of options activity during his post-earnings jump. JPMorgan Chase (JPM) is the Dow’s worst performance so far on Friday, despite a quarterly win, as it was also the bank’s worst win in about two years.
Analyst calls this week
As we start the year, many analysts are making adjustments for 2022. Dell Technologies (DELL) has reached a all-time high this week after an update from Bernstein, while releasing the name ViacomCBS (VIAC) also increased after an upgrade. Meanwhile, UBS downgraded blue-chip shares of IBM (IBM) due to its high valuation, while Guggenheim slammed Walt Disney (SAY) with a bear note.
Bank profits continue
US markets are closed on Monday to celebrate Martin Luther King Jr. Day. Compared to last week, the shortened week will be relatively quiet in terms of economic data. Still, plenty of bank revenue is available, including reports from Bank of America (BAC), Charles Schwab (SCHW), Morgan Stanley (MS), PNC (PNC), and United Airlines (UAL). In the meantime, many stocks are providing strong entry points for investors, with listings from Schaeffer’s senior quantitative analyst, Rocky White.
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