Nasdaq in Bear Zone Again After Friday Sell-off

Barry Adams
29 Apr, 2022
New York City

Stock after gyrating in the early hours of trading developed a downward trend and accelerated declines in the afternoon. 

The Nasdaq Composite declined 4.2% and the S&P 500 index fell 3.6% after the latest batch of earnings fell short of expectations. 

The Nasdaq Composite fell 13.3% in April, its worst performance since October 2008 and the S&P 500 declined 8.8%, the most since March 2020. 

In the year, S&P 500 is down 13.9% and the Nasdaq Composite has lost 22.1%. 

Both indexes closed at their new lows in the year. 

Friday marked the week of a busy earnings season with about 700 companies reporting. 

Nearly 130 companies in the S&P 500 index including leading tech companies dominated earnings news. 

More than 70% of the companies releasing earnings reported better-than-expected results estimated by Wall Street analysts but a familiar theme has started to take hold. 

Companies are battling falling demand volume, rising operating costs, and supply disruptions. 

However, most companies are passing on larger price increases to consumers higher than the increase in input and operating costs resulting in higher earnings. 

This theme was repeated across most of the companies reporting earnings in energy, retail, technology, manufacturing, and food and beverages and consumer products makers. 

The latest reading on inflation faced by consumers showed sustained and elevated inflation pressures. 

The core personal consumption expenditure price index, which measures how consumers spend across a wide range of products and services, increased 5.2% in March after rising at 5.3% in February. 

When compared to the previous core price index increased 0.3%. 

In Europe, market indexes in Paris and London gained 0.5% and in Frankfurt rose 0.8%. 

Crude oil traded higher in the day but closed down 35 cents to $105.02 a barrel. 

The U.S. 10-year bond yield edged up a fraction to close at 2.882%.