The S&P 500 is down 0.7% in midday action, as growth concerns continue to weigh on risk sentiment. The Dow Jones Industrial Average is down 0.5% while the Nasdaq Composite trades higher by 0.2%.
Growth concerns are being attributed to the same factors as before; namely, the Fed’s hawkish mindset in the face of slower growth prospects, China’s zero tolerance for COVID-19 amid a worsening outbreak and ongoing shutdowns, and Russia’s war in Ukraine that has shifted to a landgrab strategy in Eastern Ukraine.
Accordingly, the cyclical stocks are underperforming, oil prices ($96.38, -5.69, -5.6%) are down over 5.0%, and the 10-yr yield is down 12 basis points to 2.79%.
The S&P 500, however, has found support at the 4200 level (4200.82, to be precise), which represented a 5.8% decline from last Wednesday’s close. In other words, investors are starting to buy the dip after a fast move downwards.
The S&P 500 energy (-5.7%), materials (-2.2%), financials (-1.6%), and industrials (-1.6%) sectors are among today’s laggards. The communication services (+0.2%) and information technology (+0.2%) sectors are outperforming in positive territory, thanks to gains in Microsoft ( MSFT 275.96, +37.04, +1.6%) and Alphabet ( GOOG 2432.80, +40.91, +1.7%).
Both companies will report earnings later this week along with Apple ( AAPL 159.95, -1.85, -1.1%), Amazon.com ( AMZN 2877.58, -9.42, -0.3%), and Meta Platforms ( FB 184.37, +0.20, +0.1%). AAPL is underperforming amid an analyst downgrade to Sell from Neutral at Global Equities.
Coca-Cola ( KO 65.23, -0.02, unch) reported prior to today’s open, beating top and bottom-line estimates on 16.7% revenue growth. Shares of the Dow component are trading little changed after setting an all-time high earlier in the session.
Twitter ( TWTR 52.06, +3.12, +6.5%) is another standout amid reports indicating that the company could accept Elon Musk’s takeover offer as soon as today.
Investors did not receive any economic data today.