U.S. stock indexes were lower after markets opened, ahead of a wave of earnings reports from major technology and blue-chip firms, as investors contended with fears about slowing growth.
The S&P 500 shed 1.2% in early Wednesday trading. The Dow Jones Industrial Average declined 0.7%, while the technology-heavy Nasdaq Composite lost 2.2%.
fell more than 8% after warning that supply chain disruptions would pressure its business this year. Raytheon gained 0.6% after reporting a drop in first-quarter profit.
fell more than 3% despite reporting a rise in quarterly earnings. 3M fell 3% after reporting better-than-expected first-quarter sales.
are set to report earnings after markets close.
Stocks on Wall Street closed higher on Monday, led by tech stocks, after
agreed to be taken private by
The Nasdaq Composite Index rose 1.3% while the S&P 500 added 0.6%.
Fears about a resurgence of Covid-19 cases in China, and strict lockdowns imposed to fight the outbreak, have heightened investors’ concerns about the global economy and prompted choppy trading in recent sessions. Soaring inflation is weighing on companies and consumers while the Federal Reserve’s indications that it will quickly tighten monetary policy threatens to drag on growth.
“We had a beautiful scenario over the last 18 months: Growth was accelerating and bond yields were falling—the perfect combination for risk assets,” said
a portfolio manager at PineBridge Investments. “Now we have the complete opposite.”
The yield on the 10-Year U.S. Treasury note declined to 2.745% from 2.825% on Monday. The yield on the benchmark note remains close to its highest level since 2018 as investors have sold bonds in anticipation of higher interest rates. Bond yields rise as prices fall.
Assets considered havens in times of trouble, such as Treasury bonds, are being pressured by inflation and expectations for tighter central-bank policy along with stocks, complicating matters for investors seeking shelter during recent volatility. Gold, another haven, rose 0.7% on Tuesday, but prices remain close to their lowest level since February.
“Inflation really is enemy number one for financial markets. It is painful for risk assets and painful for your safety assets,” Mr. Redha said. “There are very few places to hide.”
Brent crude futures rose 1.4% to $103.55 a barrel. The international oil benchmark fell below the $100 a barrel level Monday before rebounding. U.S. benchmark oil prices, known as West Texas Intermediate, rose 1.3% to $99.82 a barrel Tuesday.
In economic news, orders for durable goods—consumer products designed to last for more than three years—rebounded in March following a weak February. The S&P CoreLogic Case-Shiller National Home Price Index, a measure of average home prices in major U.S. metropolitan areas, rose 19.8% in the year that ended in February, up from a 19.1% annual rate the prior month.
Overseas, the Stoxx Europe 600 rose 0.4%.
shares in London fell more than 3% after reporting a drop in quarterly profits.
In mainland China, the Shanghai Composite Index fell 1.4%, lower for a second consecutive day, as investors continued to worry about the threat of new Covid-19 lockdowns. The People’s Bank of China vowed to step up support for the economy Tuesday in an attempt to calm the jitters, but the move only had a temporary effect on local markets.
“I don’t see any catalyst for price appreciation until we get some tangible, meaningful moves on the policy front,” said
Asia Pacific chief investment officer at
referring to Chinese stocks.
Elsewhere in Asia, Tokyo’s Nikkei 225 index rose 0.4%, while South Korea’s Kospi edged up 0.4%. Hong Kong’s Hang Seng Index rose 0.3%.
—Rebecca Feng and Orla McCaffery contributed to this article.
Write to Will Horner at email@example.com
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