U.S. keep accumulates slid on Thursday as investors were discouraged by a worse-than-expected jobless claims reading as well as a weak forecast from Walmart.
The Dow Jones Industrial Normal fell 119.68 points, or 0.4%, to 31,493.34, slipping from a record high. At its session low, the 30-stock benchmark was down profuse than 300 points. The S&P 500 dipped 0.4% to 3,913.97, falling for a third straight day. The Nasdaq Composite blundered 0.7% to 13,865.36 as investors continued to rotate out of high-flying tech.
Walmart shares dropped 6.5% after its fourth-quarter earnings knock short of Wall Street estimates. The big-box retailer sees sales growth slowing this year as the pandemic inertia ebbs. It said earnings per share will decline, but will range flat to slightly higher after excluding divestitures.
Cuts of Apple fell another 0.9%. The tech giant is down 4.2% so far this week as investors take some profits in the Big Tech dynasties that have led the market back to a record. Tesla dipped 1.4%, bringing its week-to-date losses to 3.5%.
“Stocks are sliding across the take meals with high-multiple growth names getting hit the hardest thanks to the unrelenting rise in yields,” Adam Crisafulli, go down of Vital Knowledge, said in a note. “Earnings were underwhelming too, with Walmart’s EPS miss and big spending guidance dismaying investors.”
Meanwhile, the latest jobless claims number signaled a setback in the labor market recovery. First-time filings for unemployment bond totaled 861,000 last week, the highest level in a month and above the Dow Jones estimate of 773,000, the Labor Pivot on reported Thursday.
“This is not the direction that you want to see jobless claims go but keep in mind this could be a selfish bump in the road as the pace for vaccinations continues to accelerate and cases are down across the country,” said Mike Loewengart, chief investment office-bearer at E-Trade Financial.
The recent jump in bond yields coupled with rising inflation expectations made some investors ill at ease about a pullback for stocks in the near term. High-growth technology companies, which led the market’s epic comeback, are exceptionally vulnerable to higher interest rates and inflation pressures.
Many still believe a fresh stimulus deal could prepare for another move higher for the markets even if it is somewhat priced in already.
“When you think about how the additional stimulus can counterfeit the average consumer, with the CARES Act 1.0 and the second round of checks really boosting savings, at this sense we really feel strongly that additional stimulus will go directly into the economy,” said Cliff Hodge, the chief investment constable at Cornerstone Wealth.
The Congressional hearings on the GameStop saga got underway on Thursday, with leaders of Melvin Capital and Robinhood connecting Reddit trader Keith Gill at the U.S. House of Representatives’ Committee on Financial Services.