S&P 500 Drops 1%, Nasdaq Down 2% On Inflation and Earnings Jitters

Barry Adams
11 Jul, 2022
New York City

Benchmark indexes in New York eased as investors focus on corporate earnings and the latest guidance. 

The S&P 500 decreased 0.97% to 3,862.52 and the Nasdaq Composite index fell 1.80% to 11,432.14. 

Banks are scheduled to kickstart the earnings season with JPMorgan Chase, Morgan Stanley, Citigroup, and Wells Fargo are scheduled to release earnings.

Delta Airlines and PepsiCo are scheduled to report earnings on Tuesday. 

Investors are also awaiting the consumer price index for June on Wednesday and the measure of inflation index is expected to cross 8.6% increase in May. 

Twitter Inc declined 7.4% after Elon Musk led investment group abandoned its $44 billion takeover bid. 

Twitter said the company will sue Elon Musk and for the terms of the negotiated contract. 

Las Vegas Sands and Wynn Resorts declined more than 9% after Macau said it will close all casinos for one-week to contain the spread of coronavirus. 

 

European Markets Face Natural Gas Supplies Worries 

European markets dropped on the natural gas supplies and fresh cases of coronavirus infections in Shanghai. 

The DAX index declined 1.5% to 12,824.28, the CAC-40 index fell 0.9% to 5,977.90, and the FTSE 100 index dropped 0.2% to 7,184.22. 

Energy stocks led the decliners after Russia turned off natural gas flow for a scheduled maintenance of the segments of Nordstream-1 pipeline. 

The gas flow is scheduled to resume after 10 days but the German government has warned that Russia could halt the flow permanently.  

Mining companies also declined after new cases of BA.5 subvariant infections in parts of Shanghai forced the city authorities to resume mass testing. 

 

Asian Markets Fall, LDP In Japan Win Majority to Revise Constitution 

Asian markets closed broadly lower after the strong U.S. jobs report in June rekindled the  fears of faster rate hikes and resumption of mass testing in a few areas of Shanghai with the resurgence of coronavirus infections. 

The Nikkei 225 Index gained 1.1% to 26,812.30, while the broader Topix finished 1.4% higher to close at 1,914.66.

The ruling Liberal Democratic Party won more than 75 of the 125 seats in the upper house election paving the way for the redrafting of the pacifist constitution, the key goal of the recently assassinated former prime minister Shinzo Abe. 

Separately, the Bank of Japan revised higher its economic assessment of seven of the nine country's regions, adding the pandemic impact on consumer spending is easing. 

China's Shanghai Composite Index fell 1.27% to 3,313.58 ahead of exports and imports data scheduled on Wednesday.

Hong Kong's Hang Seng Index plunged 2.8% to 21,124.20, tech stocks led the decliners after Chinese authorities fined Alibaba and Tencent Holdings  for not reporting past transactions. 

The Sensex and Nifty indexes trimmed the losses of the day and Tata Consultancy reported flat income on 11% increase in quarterly revenues to $6.8 billon. 

Discount retailer Avenue Supermarts said June quarter sales doubled and net income soared six-fold after all 294 stores were open for the first time post pandemic.