Market Update
Late Rally In S&P 500 Trims Weekly Loss, Bond Yields Fall
Barry Adams
01 Jul, 2022
New York City
U.S. stocks kicked off the second-half on a positive note with global slowdown worries looming in the backdrop after positing the worst first-half decline in more than five decades.
The worries of global recession compounded by accelerating inflation in Europe and Asia and falling growth in new orders kept investors' appetite for riskier assets in check.
The S&P 500 declined 16% in the second quarter ending on Thursday and fell 20.6% in the first-half. The second quarter decline was the worst since the first quarter 2020.
The Nasdaq dropped 22.4% in the second quarter and its worst record since 2008 and plunged 29.4% in the first-half.
The stock market's decline in the quarter and the first-half touched every sector except commodities and energy.
In Friday's trading, the S&P 500 index increased 1.1% to 3,825.31 and the Nasdaq Composite index gained 0.9% to 11,127.83.
Despite the market gains today, the two benchmark indexes closed down for the fourth week in five.
For the week, the S&P 500 fell 6.7% and the Nasdaq Composite declined 4.1%.
The popular averages traded near the flat line but picked up momentum in the late afternoon to close higher ahead of a 3-day weekend.
Futures of crude oil increased 2.8% to $108.49 and natural gas rose 4.8% to $5.68 a unit.
The yield on 10-year Treasury notes fell to 2.9% and mortgage rates declined for the third day in a row to 5.5%.
The latest economic news from the U.S., Europe, Japan, and China pointed to a global slowdown.
The Institute of Supply Management said the U.S. manufacturing activity index declined to 53, the lowest since June 2020.
The new order index dropped to 49.2 from 55.1 in May, showing a contraction for the first time since May 2020.
The 50-mark separates expansion from contraction.
General Motors gained 0.9% to $32.04 after the automaker said the company sold 582,401 vehicles in the second quarter, 15% fewer than a year ago.
The company said supply chain disruptions have held up 95,000 vehicles lacking computer chips and certain components but vehicles are expected to be sold to dealers by the end of the year.
The automaker guided net income in the June quarter to be in the range of between $1.6 billion and $1.9 billion and adjusted earnings to be in the range of between $2.3 billion and $2.6 billion.
Micro Technology declined 2.7% to $53.78 after the chipmaker said revenues in the fiscal 2022 third quarter ending on June 2 rose to $8.6 billion from $7.6 billion a year ago.
Net income in the quarter rose to $2.6 billion or $2.34 a share from $2.3 billion or $2.0 a share a year ago.
The chipmaker's fourth quarter guidance was substantially weaker than anticipated by analysts.
The company expects fourth quarter revenues of $7.2 billion with a band of $400 million and diluted earnings per share of $1.52 with a 20 cents band.
Kohl's Corporation plunged 17.3% to $29.57 after the department store retailer terminated talks to sell its business and cited deteriorating retail environment in the last six months.
The retailer also said second quarter sales are likely to fall in high-single digits compared to the previous estimate of a decline in low-single digits and said "the company is seeing a softening in consumer spending."
The home builders advanced after 30-year fixed mortgage rates declined for the third day in a row to 5.50% after peaking at 5.9% on Jun 28, according to data available on Mortgage Daily News.
Pulte Group gained 6.8% to $42.34, Lennar Corp advanced 5.1% to $74.14, and D R Horton added 5.3% to $69.71.
Inflation In Europe Accelerates
The inflation in the euro zone accelerated to 8.6% in June from 8.1% in May according to the preliminary estimate released by the eurostat Friday.
Italian consumer prices rose at 8.0% in June after rising at 6.8% in May, a separate report from the Italian statistics office Istat showed Friday.
The U.K.'s Purchasing Managers' Index fell to a 22-month low of 52.1 in June from 54.6 in May, final data from S&P Global showed Friday.
The preliminary estimate was 52.0, any data above 50 indicates expansion.
The U.K. manufacturing activities rose at the weakest pace in nearly two years on weaker new orders and production and the overall index declined for the fifth month in a row.
The Chartered Institute of Procurement & Supply 's final Purchasing Managers' Index dropped to a two-year low of 52.8 in June from 54.6 in May.
Asian Markets Fall on Slowdown Worries
Stocks in Asia closed down after manufacturing activities stalled in the region and India imposed windfall tax on oil companies.
The Nikkei 225 index declined 1.7% to 25,935.92, Shanghai Composite index fell 0.32% to 3,387.64,and the Kospi average decreased 1.17% to 2,305.42.
The Sensex index eased 0.2% to 52,907.93 and markets in Hong Kong were closed for a holiday.
Mitsubishi Corp and Mitusi Corp fell more than 5% after Russia set up a corporation to take over the stake held by trading companies and Shell Plc in Sakhalin Energy Investment Company.
The two trading companies and Shell own just below 50% stake in the natural gas development firm.
The seizure of the stake follows the recent Western sanctions on Russian businesses, trade, and persons.
The Nikkei fell near a two-week low after the Bank of Japan's tankan survey of large companies showed business sentiment worsened in the June quarter.
Japan's jobless rate increased unexpectedly to 2.6% in May from 2.5% in April, the Ministry of Internal Affairs said Friday.
The unemployment rate increased for the first time in four months.
A private survey in China showed manufacturing activities expanded for the first time in four months in June.
The Caixin/Markit manufacturing Purchasing Managers' Index for June rose to 51.7 from 48.1 in May, according to an independent survey released Friday.
India imposed windfall tax on oil companies to sustain domestic fuel supply and raise about 67,000 crore rupees or about $9 billion.
Stocks on Dalal Street traded lower after the central government imposed windfall tax on oil companies.
Central government imposed a one-time export tax of 6 rupees a liter on petrol and jet fuel and 13 rupees a liter on diesel, announced the finance ministry Friday.
The Sensex declined 111.01 or 0.2% to 52,907.93 and the Nifty 50 index decreased 28.20 or 0.2% to 15,752.05.
South Korea's exports in June rose 5.4% to a record high $57.73 billion on solid demand for chips and petroleum products.
The export increased for the 20th month in a row but slowed to a single-digit after expanding double-digits for 15 months in a row.
June imports rose 19.4% to $60.2 billion resulting in a trade deficit of $2.47 billion.
Exports in the first half increased 15.6% to a record half-year high of $350.3 billion and imports advanced 26.2% to $360.6 billion on high energy and raw materials prices.
Movers: General Motors, Kohl's, Micron Technology, PulteGroup
Barry Adams
01 Jul, 2022
New York City
U.S. stocks struggled to move higher on the first day of the month and reacted to corporate news.
U.S. manufacturing activities declined in June but activities stalled in Europe and Asia as supply chain constraints and elevated input costs dominated.
Benchmark indexes traded sideways on the first day of the third quarter after logging the worst decline in the first-half in decades.
The S&P 500 declined 16% in the second quarter ending on Thursday and fell 20.6% in the first-half. The second quarter decline was the worst since the first quarter 2020.
The Nasdaq dropped 22.4% in the second quarter and its worst record since 2008 and plunged 29.4% in the first-half.
The stock market declined in the quarter and the first-half touched every sector except commodities and energy.
In Friday's trading, the S&P 500 index increased 0.2% to 3,794.11 and the Nasdaq Composite index traded flat at 11,019.93.
The popular averages traded near the flat line and digested the latest corporate news and economic data from the U.S., Asia and Europe.
General Motors gained 0.9% to $32.04 after the automaker said the company sold 582,401 vehicles in the second quarter, 15% fewer than a year ago.
The company said supply chain disruptions have held up 95,000 vehicles lacking computer chips and certain components but vehicles are expected to be sold to dealers by the end of 2022.
The automaker guided net income in the June quarter to be in the range of between $1.6 billion and $1.9 billion and adjusted earnings to be in the range of between $2.3 billion and $2.6 billion.
Micro Technology declined 2.7% to $53.78 after the chipmaker said revenues in the fiscal 2022 third quarter ending on June 2 rose to $8.6 billion from $7.6 billion a year ago.
Net income in the quarter rose to $2.6 billion or $2.34 a share from $2.3 billion or $2.0 a share.
The chipmaker's fourth quarter guidance was substantially weaker than anticipated by analysts.
The company expects fourth quarter revenues of $7.2 billion with a band of $400 million and diluted earnings per share of $1.52 with a 20 cents band.
Kohl's Corporation plunged 17.3% to $29.57 after the department store retailer ended its talks to sell its business and cited deteriorating retail environment in the last six months.
The retailer also said second quarter sales are likely to fall in high-single digits compared to the previous estimate of a decline in low-single digits and said "the company is seeing a softening in consumer spending."
The home builders advanced after 30-year fixed mortgage rates declined for the third day in a row to 5.50% after peaking at 5.9% on Jun 28, according to data available on Mortgage Daily News.
Pulte Group gained 6.8% to $42.34, Lennar Corp advanced 5.1% to $74.14, and DR Horton added 5.3% to $69.71.
U.S. Stocks Trade Sideways On Slowdown Worries
Barry Adams
01 Jul, 2022
New York City
Benchmark indexes traded sideways on the first day of the third quarter after logging the worst decline in the first-half in decades.
The S&P 500 declined 16% in the second quarter ending on Thursday and fell 20.6% in the first-half. The second quarter decline was the worst since the first quarter 2020.
The Nasdaq dropped 22.4% in the second quarter and its worst record since 2008 and plunged 29.4% in the first-half.
The stock market declined in the quarter and the first-half touched every sector except commodities and energy.
In Friday's trading, the S&P 500 index increased 0.2% to 3,794.11 and the Nasdaq Composite index traded flat at 11,019.93.
The popular averages traded near the flat line and digested the latest corporate news and economic data from the U.S., Asia and Europe.
The Institute of Supply Management said the U.S. manufacturing activity index declined to 53, the lowest since June 2020.
The new order index dropped to 49.2 from 55.1 in May, showing a contraction for the first time since May 2020.
The 50-mark separates expansion from contraction.
General Motors gained 0.9% to $32.04 after the automaker said the company sold 582,401 vehicles in the second quarter, 15% fewer than a year ago.
The company said supply chain disruptions have held up 95,000 vehicles lacking computer chips and certain components but vehicles are expected to be sold to dealers by the end of 2022.
The automaker guided net income in the June quarter to be in the range of between $1.6 billion and $1.9 billion and adjusted earnings to be in the range of between $2.3 billion and $2.6 billion.
Micro Technology declined 2.7% to $53.78 after the chipmaker said revenues in the fiscal 2022 third quarter ending on June 2 rose to $8.6 billion from $7.6 billion a year ago.
Net income in the quarter rose to $2.6 billion or $2.34 a share from $2.3 billion or $2.0 a share.
The chipmaker's fourth quarter guidance was substantially weaker than anticipated by analysts.
The company expects fourth quarter revenues of $7.2 billion with a band of $400 million and diluted earnings per share of $1.52 with a 20 cents band.
Kohl's Corporation plunged 17.3% to $29.57 after the department store retailer ended its talks to sell its business and cited deteriorating retail environment in the last six months.
The retailer also said second quarter sales are likely to fall in high-single digits compared to the previous estimate of a decline in low-single digits and said "the company is seeing a softening in consumer spending."
Inflation In Europe Accelerates
The inflation in the euro zone accelerated to 8.6% in June from 8.1% in May according to the preliminary estimate released by the eurostat Friday.
Italian consumer prices rose at 8.0% in June after rising at 6.8% in May, a separate report from the Italian statistics office Istat showed Friday.
The manufacturing Purchasing Managers' Index fell to a 22-month low of 52.1 in June from 54.6 in May, final data from S&P Global showed Friday.
The preliminary estimate was 52.0, any data above 50 indicates expansion.
The U.K. manufacturing activities rose at the weakest pace in nearly two years on weaker new orders and production and the overall index declined for the fifth month in a row.
The Chartered Institute of Procurement & Supply 's final Purchasing Managers' Index dropped to a two-year low of 52.8 in June from 54.6 in May.
European Markets Falter After Euro Zone Inflation Accelerates
Bridgette Randall
01 Jul, 2022
New York City
Benchmark indexes in Europe were broadly higher after manufacturing growth eased less than expected and inflation accelerated in the euro zone.
The inflation in the euro zone accelerated to 8.6% in June from 8.1% in May according to the preliminary estimate released by the eurostat Friday.
Energy prices rose 41.9% in June compared to 39.1% in May and food, alcohol, and tobacco prices advanced 8.9% compared to 7.5%, non-energy industrial goods prices increased 4.3% from 4.2%, and the cost of services fell to 3.4% from 3.5%.
Italian consumer prices rose at 8.0% in June after rising at 6.8% in May, a separate report from the Italian statistics office Istat showed Friday.
The manufacturing Purchasing Managers' Index fell to a 22-month low of 52.1 in June from 54.6 in May, final data from S&P Global showed Friday.
The preliminary estimate was 52.0, any data above 50 indicates expansion.
The manufacturing activities rose at the weakest pace in nearly two years on weaker new orders and production and the overall index declined for the fifth month in a row.
The U.K. Manufacturing growth slowed in June after production stalled and new order intake contracted for the first time in more than a year.
The Chartered Institute of Procurement & Supply 's final Purchasing Managers' Index dropped to a two-year low of 52.8 in June from 54.6 in May.
The DAX index rose 0.2% to 12,813.03, the CAC-40 index increased 0.14%, and the FTSE 100 index fell a fraction to close at 7,168.85.
The Dutch semiconductor equipment maker ASML fell 6.6% and Infineon dropped 3.5% after the U.S. based memory chip maker Micron Technology offered a business outlook significantly weaker than anticipated.
Siemens AG declined 1.2% after the German conglomerate said it plans to book a non-cash 2.8 billion euros impairment charge for its investment in Siemens Energy AG.
Shell Plc declined 1.2% after Russia seized its minority stake in Sakhalin Energy Investment Company focused on natural gas projects.
Trading companies Mitsui and Mitsubishi along with Shell controlled just under 50% stake in the joint venture with Russia-controlled Gazprom.
Sodexo SA gained 4.1% to 69.78 euros after the French catering company reported fiscal year third quarter revenues increased 23% and reiterated its full-year outlook.
TUI AG increased 3.3% to 136.85 pence after the travel service and tour operator said it has repaid loans received from the government under Silent Participation II of 671 million euros.
Including interest, the company repaid 725 million euros to the economic stabilization fund.
The company repaid loans after completing capital in mid-May from new investors.
Asian Markets Fall On Weak China, Japan and S. Korea Economic Data
Stocks in Asia closed down after manufacturing activities stalled in the region and India imposed windfall tax on oil companies.
The Nikkei 225 index declined 1.7% to 25,935.92, Shanghai Composite index fell 0.32% to 3,387.64, the Kospi average decreased 1.17% to 2,305.42, and the Sensex index eased 0.2% to 52,907.93.
Markets in Hong Kong were closed for a holiday.
The Nikkei fell near a two-week low after the Bank of Japan[s tankan survey of large companies showed sentiment worsened in the three-month period to June.
The business executives estimated the yen to weaken to 131.65 against one dollar from the previous estimate of 128.20 in the March survey.
Japan's jobless rate increased unexpectedly to 2.6% in May from 2.5% in April, the Ministry of Internal Affairs said Friday.
The unemployment rate increased for the first time in four months.
The private survey in China showed manufacturing activities expanded for the first time in four months in June.
Home sales in China also appear to be on the rebound in June according to the latest data release by China Real Estate Information Corp on Friday.
Total home sales for the top 100 real estate developers increased 61.2% in June to 733 billion yuan or $109.4 billion, ahead of 5.6% rise in May.
India's manufacturing activities expanded in June but growth slipped to a nine-month low on elevated price pressures.
The S&P Global factory Purchasing Managers' Index fell to 53.9 in June from 54.6 in May.
Any reading above 50 indicates expansion.
The manufacturing sector expanded for the 12th month in a row but the growth rate slipped to the weakest since September 2021.
India imposed windfall tax on domestic oil companies to sustain domestic fuel supply and raise about 67,000 crore rupees or about $9 billion.
The Sensex declined 111.01 or 0.2% to 52,907.93 and the Nifty 50 index decreased 28.20 or 0.2% to 15,752.05.
South Korea's Trade Deficit Record High In First Half
South Korea's exports in June rose 5.4% to a record high $57.73 billion on solid demand for chip and petroleum products.
The export increased for the 20th month in a row but slowed to a single-digit after expanding double-digits for 15 months in a row.
June imports rose 19.4% to $60.2 billion resulting in a trade deficit of $2.47 billion.
Exports in the first half increased 15.6% to a record half-year high of $350.3 billion and imports advanced 26.2% to $360.6 billion on high energy and raw materials prices.
Japan's Business Sentiment Worsens, Jobless Rate Rises
Brian Turner
01 Jul, 2022
New York City
The Nikkei fell near a two-week low after the Bank of Japan[s tankan survey of large companies showed sentiment worsened in the three-month period to June.
The sentiment index among large companies dropped to 9 from 14 in the previous survey for three months ending in March.
The business executives estimated the yen to weaken to 131.65 against one dollar from the previous estimate of 128.20 in the March survey.
Japan's Jobless Rate Rises
Japan's jobless rate increased unexpectedly to 2.6% in May from 2.5% in April, the Ministry of Internal Affairs said Friday.
The unemployment rate increased for the first time in four months.
On a seasonally adjusted basis, the total number of employed declined to 67.24 million, a fall of 140,000 from April the ministry added.
On a seasonally adjusted basis, the total number of unemployed increased to 1.8 million, a rise of 40,000 from April.
The number of new job seekers were unchanged at 460,000 in May from April and voluntary departures increased 8.2% in May to 790,000.
China Factory Activities Expand
Brian Turner
01 Jul, 2022
New York City
The private survey in China showed manufacturing activities expanded for the first time in four months in June.
The Caixin/Markit manufacturing Purchasing Managers' Index for June rose to 51.7 from 48.1 in May, according to an independent survey released Friday.
With the easing of coronavirus restrictions and gradual opening of the economy, factory activities are picking up in the second largest economy of the world.
China Home Sales Rebound in June
Brian Turner
01 Jul, 2022
New York City
Home sales in China also appear to be on the rebound in June according to the latest data release by China Real Estate Information Corp on Friday.
Total home sales for the top 100 real estate developers increased 61.2% in June to 733 billion yuan or $109.4 billion, ahead of 5.6% rise in May.
South Korea's Trade Deficit Record High In First Half
Arjun Pandit
01 Jul, 2022
New York City
South Korea's exports in June rose 5.4% to a record high $57.73 billion on solid demand for chip and petroleum products.
The export increased for the 20th month in a row but slowed to a single-digit after expanding double-digits for 15 months in a row.
June imports rose 19.4% to $60.2 billion resulting in a trade deficit of $2.47 billion.
Exports in the first half increased 15.6% to a record half-year high of $350.3 billion and imports advanced 26.2% to $360.6 billion on high energy and raw materials prices.
India Imposes Windfall Tax On Oil Companies
Arjun Pandit
01 Jul, 2022
New York City
India imposes windfall tax on domestic oil companies to sustain domestic fuel supply and raise about 67,000 crore rupees or about $9 billion.
Central government imposed a one-time export tax of 6 rupees a liter on petrol and jet fuel and 13 rupees a liter on diesel, announced the finance ministry on Friday.
The finance ministry's move eliminates the price differential between domestic and export markets and sustains the domestic fuel supply.
Madhya Pradesh, Rajasthan and Gujarat were facing fuel shortages after private refineries preferred to export than meet the domestic demand.
Stocks on Dalal Street traded lower after the central government imposed windfall tax on oil companies.
The Sensex declined 111.01 or 0.2% to 52,907.93 and the Nifty 50 index decreased 28.20 or 0.2% to 15,752.05.
Asian Markets Fall On Stalled Manufacturing, Japan's Jobless Rate Rises
Arjun Pandit
01 Jul, 2022
New York City
Stocks in Asia closed down after manufacturing activities stalled in the region and India imposed windfall tax on oil companies.
The Nikkei 225 index declined 1.7% to 25,935.92, Shanghai Composite index fell 0.32% to 3,387.64, the Kospi average decreased 1.17% to 2,305.42, and the Sensex index eased 0.2% to 52,907.93.
Markets in Hong Kong were closed for a holiday.
Mitsubishi Corp and Mitusi Corp fell more than 5% after Russia set up a corporation to take over the stake held by trading companies and Shell Plc in Sakhalin Energy Investment Company.
Three companies and Shell own just below 50% stake in the natural gas development firm.
The seizure of stake comes following the recent Western sanctions on Russian businesses, trade, and persons.
Japan's Business Sentiment Worsens
The Nikkei fell near a two-week low after the Bank of Japan[s tankan survey of large companies showed sentiment worsened in the three-month period to June.
The sentiment index among large companies dropped to 9 from 14 in the previous survey for three months ending in March.
The business executives estimated the yen to weaken to 131.65 against one dollar from the previous estimate of 128.20 in the March survey.
Japan's Jobless Rate Rises
Japan's jobless rate increased unexpectedly to 2.6% in May from 2.5% in April, the Ministry of Internal Affairs said Friday.
The unemployment rate increased for the first time in four months.
On a seasonally adjusted basis, the total number of employed declined to 67.24 million, a fall of 140,000 from April the ministry added.
On a seasonally adjusted basis, the total number of unemployed increased to 1.8 million, a rise of 40,000 from April.
The number of new job seekers were unchanged at 460,000 in May from April and voluntary departures increased 8.2% in May to 790,000.
China Factory Activities Expand
The private survey in China showed manufacturing activities expanded for the first time in four months in June.
The Caixin/Markit manufacturing Purchasing Managers' Index for June rose to 51.7 from 48.1 in May, according to an independent survey released Friday.
With the easing of coronavirus restrictions and gradual opening of the economy, factory activities are picking up in the second largest economy of the world.
China Home Sales Rebound in June
Home sales in China also appear to be on the rebound in June according to the latest data release by China Real Estate Information Corp on Friday.
Total home sales for the top 100 real estate developers increased 61.2% in June to 733 billion yuan or $109.4 billion, ahead of 5.6% rise in May.
India's manufacturing activities expanded in June but growth slipped to a nine-month low on elevated price pressures.
India's Manufacturing Growth Slows
The S&P Global factory Purchasing Managers' Index fell to 53.9 in June from 54.6 in May.
Any reading above 50 indicates expansion.
The manufacturing sector expanded for the 12th month in a row but the growth rate slipped to the weakest since September 2021.
India Imposes Windfall Tax On Oil Companies
India imposes windfall tax on domestic oil companies to sustain domestic fuel supply and raise about 67,000 crore rupees or about $9 billion.
Stocks on Dalal Street traded lower after the central government imposed windfall tax on oil companies.
Central government imposed a one-time export tax of 6 rupees a liter on petrol and jet fuel and 13 rupees a liter on diesel, announced the finance ministry on Friday.
The finance ministry's move eliminates the price differential between domestic and export markets and sustains the domestic fuel supply.
Madhya Pradesh, Rajasthan and Gujarat were facing fuel shortages after private refineries preferred to export than meet the domestic demand.
The Sensex declined 111.01 or 0.2% to 52,907.93 and the Nifty 50 index decreased 28.20 or 0.2% to 15,752.05.
South Korea's Trade Deficit Record High In First Half
South Korea's exports in June rose 5.4% to a record high $57.73 billion on solid demand for chip and petroleum products.
The export increased for the 20th month in a row but slowed to a single-digit after expanding double-digits for 15 months in a row.
June imports rose 19.4% to $60.2 billion resulting in a trade deficit of $2.47 billion.
Exports in the first half increased 15.6% to a record half-year high of $350.3 billion and imports advanced 26.2% to $360.6 billion on high energy and raw materials prices.
U.S. Stock Market's Worst First-Half Returns In Decades May Not Be Over
Barry Adams
30 Jun, 2022
New York City
U.S. stocks closed down after another volatile day reacting to fresh batch of economic data.
The S&P 500 index dropped 0.9% to 3,785.35 and the Nasdaq Composite index fell 1.3% to 11,028.74.
Market sentiment was weak as focus shifted to consumer's health after spending rose at the slowest pace in a year and just a few days ago the first quarter economic decline was revised deeper on weaker-than-expected consumption.
The personal spending rose 0.2% in May, the slowest pace in the year according to the latest data from the Bureau of Economic Analysis.
Weekly initial claims for the week ending June 25 decreased by 2,000 to 231,000, the Labor Department reported today.
The continuing claims for the week ending June 18 decreased by 3,000 to 1.328 million.
However, the strength in the labor market was overwhelmed by the elevated inflation data today.
The personal consumption expenditures index, Fed's preferred measure of inflation, on an annual basis increased at 6.3% in June and matched the rate in May, the data from the Bureau of Economic Analysis showed on Thursday.
The core index, excluding food and energy prices, declined to 4.7% in May from 4.9% in April but still at elevated levels last seen in the 1980s.
The S&P 500 index fell over 20% and the Nasdaq Composite index declined 30% in the first-half and the indexes delivered their worst first-half results in 52 years.
The market turmoil touched every sector of the economy except the commodities and oil and the S&P 500 index has fallen in 10 of the last 12 weeks punctuated with sharp rallies followed by deeper losses.
The S&P 500 index fell in the first-half in 17 of the last 53 years.
The widely followed index dropped 21% in the first-half of 1970 and rebounded 26.5% in the second-half and closed up 4.01%.
The indexes are likely to face more pain in the second-half, unlike in the previous downturns when the Fed was ready to provide more liquidity and relief in interest rates.
The Fed has exhausted most potent of its tools - lowering interest rates and buying government debts - and support asset prices.
The yield on 10-year Treasury notes declined to 3.014%.
Futures of crude oil dropped 3.6% to $105.86 a barrel and natural gas dropped 14% to $5.58 a thermal unit.
Retail stocks led the decliners after luxury furnishing retailer RH Inc issued its second revenue warning in a month.
RH dropped 10.5% to $212.05 after the retailer said second quarter revenues are estimated to decline between 1% and 3% and fiscal 2022 sales are estimated to fall between 2% and 5% from the previous range between zero and 2% growth issued on June 2.
Tech stocks continued their slide in the morning trading and the tech-heavy Nasdaq is set to decline more than 20% in the second quarter.
Apple Inc fell 1.9%, Alphabet declined 2.2%, Amazon dropped 2.3%, and Meta eased 0.4%.
European Indexes Log Worst Quarterly Losses Since 2020
Market indexes across Europe faced selling pressure after French inflation rose at the fastest pace since the euro introduction and German jobless rate rose unexpectedly.
The euro zone unemployment rate fell to a record low 6.6% in May from 6.7% in April and 8.1% a year ago, the eurostat data showed on Thursday.
The number of unemployed people in the currency zone fell to 11.004 million, a decline of 2.165 million from a year ago.
Youth unemployment rate declined to 13.1% in May from 13.8% in April.
The EU 27 jobless rate held at 6.1% in May.
German retail sales in May increased 0.6% after adjusting for inflation and rose 2.0% in nominal terms from April, the Federal Statistical Office or destatis said on Thursday.
From a year ago, real retail sales declined 3.6% and nominal retail sales rose 4.1% in May.
June unemployment rate adjusted for seasonal factors in Germany increased to 5.3% from 4.9% in May, Destatis data showed on Thursday.
Jobless rate a year ago was 5.7%.
The unemployment rate increased unexpectedly after Ukrainian refugees were counted in people searching for jobs.
French inflation rate rose at the fastest pace since the euro was introduced in 1999.
Consumer price inflation rose 5.8% in June after rising at 5.2% in May, according to the latest data released by Insee on Thursday.
The inflation rate a year ago was 1.5%.
The DAX index dropped 1.7% to 12,783.77, the CAC-40 index declined 1.8% to 5,922.86, and the FTSE 100 index fell 1.96% to 7,169.28.
The German index dropped more than 20% and the French index over 18% in the first half of 2022.
The FTSE index in London closed the first-half down more than 4%.
The indexes sank more after the release of U.S. inflation data.
The core personal consumption expenditures price index increased to 4.7% in May, lower than 4.9% in April, the U.S. Commerce Department reported on Thursday.
The inflation measure declined in May but still elevated near the levels last seen in the 1980s dragged market indexes in New York and in Europe.
BioNTech SE gained 1.9% to 137.50 euros after the company along with Pfizer Inc were awarded a new vaccine order worth $3.2 billion.
Uniper SE dropped 117.10% to 13.72 euros after the German Utility withdrew its annual outlook for the fiscal year 2022 citing natural gas restrictions from Russia-based Gazprom.
Bunzl Plc increased 1.7% to 2,717.0 pence after the U.K.-based business supplies distributor lifted its outlook for the year.
Saab AB jumped 3.7% to 420.90 Swedish kroner after the defense group won an order of 7.3 billion kroner from the Swedish government.
Asian Markets Close Down On Weaker Rebound in China Activities
Markets in Asia traded down in cautious trading as global recession worries dominated market sentiment.
The Nikkei 225 index declined 1.5% to 26,393.04 and the Hang Seng Index fell 0.6% to 21,859.79.
Tech stocks led the decliners in Tokyo and in Hong Kong.
Toyota Motor dropped 1.3% after the largest automaker missed its latest production target.
Tokyo Electron fell 4.1% to 44,300 yen and Screen Holdings fell 5.4% to 9,170 yen.
The official measure of factory and service activities showed an expansion in June after contracting for three months in a row. but the rate was slower than expected.
The Kospi average dropped 1.91% to close at 2,332.64.
In Seoul trading, Hyundai Motor gained 2.9% but SK Hynix fell 3.2% and Samsung Electronics dropped 1.7%.
India stocks in volatile trading closed down as global slowdown and elevated inflation worries dominated trading sentiment.
Benchmark indexes in directionless trading charted a volatile pattern.
The Sensex index fell 8.03 to 53,018.94 and the Nifty index eased 18.18 to 15,780.25.
Weak iron ore prices and worries of higher and faster interest rates also dragged down Australian indexes.
The ASX 200 dropped 1.97% to 6,568.10.
Banks led the decliners and Commonwealth Bank of Australia declined 2.8% to $90.38, Westpac Banking Corp dropped 2.2% to $19.50, National Australia Bank fell 2.4% to $27.39, and ANZ declined 2.7% to $22.03.
BHP Group, Rio Tinto and Fortescue Metals gained between 3% and 5%.
Movers: Bassett, Furniture, Carnival, MSC Industrial, RH, Schnitzer Steel, UniFirst, Walgreens
Barry Adams
30 Jun, 2022
New York City
U.S. stocks extend losses in the quarter and first half after inflation and economic slowdown worries dominated market sentiment.
The S&P 500 index dropped 0.4% to 3,805.75 and the Nasdaq Composite index fell 0.6% to 11,112.38.
Bassett Furniture Industries Inc 5.9% to 17.26 reported sales in the fiscal 2022 second quarter ending in May increased 17.0% to $128.7 million.
Net income in the quarter rose to $47.2 million or $4.95 a share from $5.97 million or 60 cents a share.
Inventories at the end of the quarter rose 19% to $92.8 million.
The results included the sale of the Zenith Logistics subsidiary to J. B. Hunt Transport Services, Inc. on February 28, 2022 and generated $47.1 million of net income, or $4.94 per share.
Zenith Logistics was sold for $85.5 million to JB Hunt.
Excluding the transaction, on a comparable basis earnings per share rose to 81 cents from 51 cents a year ago.
Carnival Corp declined 4.8% to $8.49 and extended this week's loss to over 20% after Morgan Stanley issued negative comments and warned that the stock could go to zero in the event of another demand shock.
Royal Caribbean Cruises declined 4.4% and Norwegian Cruise Line dropped 5.5%.
Retail stocks led the decliners after luxury furnishing retailer RH Inc issued its second revenue warning in a month.
MSC Industrial Supply Co increased 0.3% to $75.56 after the company said sales in the fiscal 2022 third quarter increased 10.7% to $958.7 million.
Net income in the quarter increased 5.5% to $99.7 million or $1.78 a share from $99.4 million or $1.68 a share.
The company guided double digit average sales growth to continue in the fiscal fourth quarter.
RH dropped 10.5% to $212.05 after the retailer said second quarter revenues are estimated to decline between 1% and 3% and fiscal 2022 sales are estimated to fall between 2% and 5% from the previous range between zero and 2% growth issued on June 2.
Tech stocks continued their slide in the morning trading and the tech-heavy Nasdaq is set to decline more than 20% in the second quarter.
Apple Inc fell 1.9%, Alphabet declined 2.2%, Amazon dropped 2.3%, and Meta eased 0.4%.
Schnitzer Steel Industries declined 2.7% to $33.35 after the company said sales in the third quarter ending in May rose 23.1% to $1.01 billion.
Net income increased to $76 million from $65 million a year ago and diluted earnings per share rose to $2.52 from $2.16 a year ago.
The company declared a cash dividend of 18.75 cents a common share, payable July 25, 2022 to shareholders of record on July 11, 2022.
Schnitzer has paid a dividend every quarter since going public in November 1993.
UniFirst Corp rose 3.5% to $169.32 after the uniform rental company reported sales in the fiscal 2022 third quarter ending in May rose 10.2% to $511.5 million.
Net income plunged 40.3% to $25.1 million or $1.33 a share from $42.0 million or $2.21 a share.
The company guided revenues in fiscal 2022 between $1.993 billion and $2.0 billion and diluted earnings per share between $5.40 and $5.60.
Walgreens Boots Alliance Inc declined 4.7% to $38.95 after the drug retailer said sales in the fiscal 2022 third quarter ending in May declined 4.2% to $32.6 billion.
Net income declined $289 million from $1.2 billion a year ago and diluted earnings per share fell to 33 cents from $1.38 a year ago.
U.S. retail stores' comparable sales increased 1.4% from a year ago and gained 2.4% excluding tobacco sales.
U.S. pharmacy sales decreased 9.7% from a year ago negatively impacted by an 11 percentage point decline in the AllianceRx Walgreens business.
PCE Shows Moderating Inflation, Prices Rose Faster Than Income and Spending In May
Brian Turner
30 Jun, 2022
New York City
Personal income increased 0.5% to $113.4 billion and disposable personal income rose 0.5% to $96.5 billion and personal consumption expenditures increased 0.2% to $32.7 billion, the Bureau of Economic Analysis reported today.
After adjusting for inflation, real disposable personal income decreased 0.1% in May and real personal consumption expenditure fell 0.4%.
Personal outlays increased $38.3 billion in May and personal saving was $1.01 trillion in May and the personal saving rate
S&P 500 Index Extends Largest First-Half Decline In Five Decades
Barry Adams
30 Jun, 2022
New York City
U.S. stocks extended losses in the quarter and first half after inflation and economic slowdown worries dominated market sentiment.
The S&P 500 index dropped 1.2% to 3,772.45 and the Nasdaq Composite index fell 1.6% to 10,999.08.
Weekly initial claims for the week ending June 25 decreased by 2,000 to 231,000, the Labor Department reported today.
The continuing claims for the week ending June 18 decreased by 3,000 to 1.328 million.
However, the strength in the labor market was overwhelmed by the elevated inflation data today.
The personal consumption expenditures index on an annual basis increased at 6.3% in June and matched the rate in May, the data from the Bureau of Economic Analysis showed on Thursday.
The core index, excluding food and energy prices, declined to 4.7% in May from 4.9% in April but still at elevated levels last seen in the 1980s.
The S&P 500 index was down 20% in the year to Wednesday and the index is set to deliver its worst first half of the year in 52 years.
The yield on 10-year Treasury notes declined to 3.004%.
Futures of crude oil dropped 3.7% to $105.76 a barrel and natural gas dropped 41 cents to $6.08 a thermal unit.
Retail stocks led the decliners after luxury furnishing retailer RH Inc issued its second revenue warning in a month.
RH dropped 10.5% to $212.05 after the retailer said second quarter revenues are estimated to decline between 1% and 3% and fiscal 2022 sales are estimated to fall between 2% and 5% from the previous range between zero and 2% growth issued on June 2.
Tech stocks continued their slide in the morning trading and the tech-heavy Nasdaq is set to decline more than 20% in the second quarter.
Apple Inc fell 1.9%, Alphabet declined 2.2%, Amazon dropped 2.3%, and Meta eased 0.4%.
European Indexes Log Worst Quarterly Losses Since 2020
Market indexes across Europe faced selling pressure after French inflation rose at the fastest pace since the euro introduction and German jobless rate rose unexpectedly.
The euro zone unemployment rate fell to a record low 6.6% in May from 6.7% in April and 8.1% a year ago, the eurostat data showed on Thursday.
The number of unemployed people in the currency zone fell to 11.004 million, a decline of 2.165 million from a year ago.
Youth unemployment rate declined to 13.1% in May from 13.8% in April.
The EU 27 jobless rate held at 6.1% in May.
German retail sales in May increased 0.6% after adjusting for inflation and rose 2.0% in nominal terms from April, the Federal Statistical Office or destatis said on Thursday.
From a year ago, real retail sales declined 3.6% and nominal retail sales rose 4.1% in May.
June unemployment rate adjusted for seasonal factors in Germany increased to 5.3% from 4.9% in May, Destatis data showed on Thursday.
Jobless rate a year ago was 5.7%.
The unemployment rate increased unexpectedly after Ukrainian refugees were counted in people searching for jobs.
French inflation rate rose at the fastest pace since the euro was introduced in 1999.
Consumer price inflation rose 5.8% in June after rising at 5.2% in May, according to the latest data released by Insee on Thursday.
The inflation rate a year ago was 1.5%.
The DAX index dropped 2.5% to 12,674.51, the CAC-40 index declined 2.6% to 5,874.96, and the FTSE 100 index fell 2.2% to 7,152.98.
The German index is set to drop more than 20% and French index over 17% in the first half of 2022.
The FTSE index in London is set to close the first half down more than 4%.
The indexes sank more after the release of U.S. inflation data.
The core personal consumption expenditures price index increased to 4.7% in May, lower than 4.9% in April, the U.S. Commerce Department reported on Thursday.
The inflation measure declined in May but still elevated near the levels last seen in the 1980s dragged market indexes in New York and in Europe.
BioNTech SE gained 1.9% to 137.50 euros after the company along with Pfizer Inc were awarded a new vaccine order worth $3.2 billion.
Uniper SE dropped 117.10% to 13.72 euros after the German Utility withdrew its annual outlook for the fiscal year 2022 citing natural gas restrictions from Russia-based Gazprom.
Bunzl Plc increased 1.7% to 2,717.0 pence after the U.K.-based business supplies distributor lifted its outlook for the year.
Saab AB jumped 3.7% to 420.90 Swedish kroner after the defense group won an order of 7.3 billion kroner from the Swedish government.
European Markets Drop 2%, French Inflation Accelerates to Record High
Bridgette Randall
30 Jun, 2022
New York City
Market indexes across Europe faced selling pressure after French inflation rose at the fastest pace since the euro introduction and German jobless rate rose unexpectedly.
The euro zone unemployment rate fell to a record low 6.6% in May from 6.7% in April and 8.1% a year ago, the eurostat data showed on Thursday.
The number of unemployed people in the currency zone fell to 11.004 million, a decline of 2.165 million from a year ago.
Youth unemployment rate declined to 13.1% in May from 13.8% in April.
The EU 27 jobless rate held at 6.1% in May.
German retail sales in May increased 0.6% after adjusting for inflation and rose 2.0% in nominal terms from April, the Federal Statistical Office or destatis said on Thursday.
From a year ago, real retail sales declined 3.6% and nominal retail sales rose 4.1% in May.
June unemployment rate adjusted for seasonal factors in Germany increased to 5.3% from 4.9% in May, Destatis data showed on Thursday.
Jobless rate a year ago was 5.7%.
The unemployment rate increased unexpectedly after Ukrainian refugees were counted in people searching for jobs.
French inflation rate rose at the fastest pace since the euro was introduced in 1999.
Consumer price inflation rose 5.8% in June after rising at 5.2% in May, according to the latest data released by the French statistics office Insee on Thursday.
The inflation rate a year ago was 1.5%.
Harmonized inflation rate in June increased to 6.5% in June from 5.8% in May and 1.9% a year ago, the Insee data showed.
This week Spain reported inflation surged to 10.2% in June on an annual basis and German inflation in June edged down to 8.2% from 8.7% in May.
The DAX index dropped 2.5% to 12,674.51, the CAC-40 index declined 2.6% to 5,874.96, and the FTSE 100 index fell 2.2% to 7,152.98.
The indexes sank more after the release of U.S. inflation data.
The core personal consumption expenditures price index increased to 4.7% in May, lower than 4.9% in April, the U.S. Commerce Department reported on Thursday.
The inflation measure declined in May but still elevated near the levels last seen in the 1980s dragged market indexes in New York and in Europe.
BioNTech SE gained 1.9% to 137.50 euros after the company along with Pfizer Inc were awarded a new vaccine order worth $3.2 billion.
Uniper SE dropped 117.10% to 13.72 euros after the German Utility withdrew its annual outlook for the fiscal year 2022 citing natural gas restrictions from Russia-based Gazprom.
Bunzl Plc increased 1.7% to 2,717.0 pence after the U.K.-based business supplies distributor lifted its outlook for the year.
Saab AB jumped 3.7% to 420.90 Swedish kroner after the defense group won an order of 7.3 billion kroner from the Swedish government.