US Stocks Slump Again: Hits New 52-Week Low
3:15 pm Thursday, September 29th, 2022
Today’s trade has a distinctly negative disposition, giving back all of yesterday’s gains. The S&P 500 set a new low for 2022, but the market has been inching off session lows since midmorning. The quick unraveling of yesterday’s rally has diminished buying interest.
UK Prime Minister Truss defending her tax cut plan in spite of the tumult it has caused in capital markets. Cleveland Fed President Mester (FOMC voter) indicating in a CNBC interview that the Fed is not yet in restrictive territory with its policy rate
Initial jobless claims — a leading indicator — falling to their lowest level (193,000) since early May and giving the Fed a basis to maintain an aggressive line with its rate hikes. Rising geopolitical angst following reports suggesting President Putin will announce the annexation of four Ukraine territories on Friday
Weakness in Apple (AAPL), which is responding to a BofA downgrade to Neutral from Buy that was pinned on concerns about negative revisions to earnings estimates being driven by weaker consumer demand
There has been a decent pullback in the 10-yr Treasury note yield from earlier highs, yet that hasn’t offered much support for the stock market since the yield is still above Wednesday’s settlement. The 10-yr yield was at 3.81% around the time the stock market opened, but now sits at 3.77%, up seven basis points from yesterday. The 2-yr note yield is up 11 basis points to 4.20%.
Many stocks are moving lower today. The mega cap stocks are among the biggest losers, which is having an influential impact on the major indices. The Vanguard Mega Cap Growth ETF (MGK) is down 2.9% versus a 1.8% loss in the Invesco S&P 500 Equal Weight ETF (RSP) and a 2.1% loss in the S&P 500.
Ten of the 11 S&P 500 sectors show decent losses today. The consumer discretionary sector (-3.1%), weighed down by recession concerns and the disappointing earnings report from CarMax (KMX), sits in last place. Energy (flat) has been popping in and out of positive territory as oil prices inch higher. WTI crude oil futures are up 0.9% to $82.88/bbl.
Decliners lead advancers by a better than 6-to-1 margin at the NYSE and a nearly 4-to-1 margin at the Nasdaq.
