US stock market turns negative; S&P 500 slipped into bear market

The S&P 500 and Nasdaq are on track for their seventh consecutive weekly loss, their longest losing streak since 2001, according to market data from Dow Jones. The Dow is on its way to its eighth consecutive weekly decline, the longest streak of its kind since 1932. All three indexes have recently been on track to end the week down at least 4%.

The markets were hit by severe fears US health and the global economy. Technology stocks started the week higher, but only fell in subsequent days as investor concerns about how far the Federal Reserve would go to rein in inflation led the stock market to sell off the most expensive stocks.

The pain has spread beyond the tech sector. Major retailers reported that their profits were hit by rising costs and supply chain disruptions, leading to sell-offs that led to target and

Walmart‘s

The worst one-day drop since the 1987 Black Monday crash.

Stocks got a short reprieve on Friday, opening higher after China’s central bank interest rate cut That acts as a benchmark for mortgages. But the markets then retracted their entire morning gains within a few hours. Investors and analysts say they expect tight financial conditions in the US to continue to pressure markets in the coming weeks.

“We still need to build more evidence to convince markets that an easy landing is possible,” said Aaron Say, multi-asset strategist at Pictet Asset Management, referring to the Fed’s goal of slowing the economy enough to contain inflation but not too much. cause stagnation.

Government bond prices rose, benefiting from the influx of investors towards assets that tend to perform well in times of economic stress. The yield on the benchmark 10-year Treasury on Friday fell to 2.817% from 2.854% on Thursday, heading for a third consecutive day of decline. Prices rise when returns fall.

Earnings led swings between individual stocks on Friday.

shares

Ross Stores

It fell 22% after its publication drop in sales She said she expects another drop this quarter. The retailer, like many other companies, said its results were hurt by higher transportation and labor costs.

agricultural equipment maker

monastery

It’s down 12% despite posting it Increased sales and profits On strong demand. Its CEO said supply chain problems have disrupted production and delivery levels.

while,

foot locker

It rose 3.2% after the company’s chief financial officer said he expects the company’s full-year earnings to be at the upper end of guidance.

Palo Alto Networks

It added 8.4% after the cybersecurity firm reported quarterly revenue that beat analyst expectations.

For the most part, earnings among the S&P 500 companies were better than analysts had expected, said Kiran Ganesh, multi-asset strategist at UBS.

“The question is from the next quarter onwards, where we will have the full impact of higher oil prices and the war in Ukraine,” Ganesh said.

Offshore, the Stoxx Europe 600 Index is up 1.5%. Asian stocks were also higher, with the Shanghai Composite up 1.6% and Hong Kong’s Hang Seng Index jumping 3%.

Write to Anna Hirtenstein at [email protected] and Akane Otani at [email protected]