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- US stocks fell about 1% on Thursday as bond yields jumped to their highest level since November.
- The 2-Year US Treasury yield hit 4.50% as investors expect more interest rate hikes from the Federal Reserve.
- A slew of positive earnings results from consumer-oriented firms had provided an initial boost to stocks in morning trades.
US stocks fell about 1% on Thursday as bond yields rose to their highest level in months on expectations that the Federal Reserve will keep rates higher for longer.
Stocks were initially higher in early morning trades after a slew of earnings from consumer-oriented companies bested investor expectations.
Disney surged as much as 6% after its theme park division posted solid results and the company said it would embark on a restructuring strategy that would save billions of dollars and cut thousands of jobs. The stock eventually erased all of those gains and fell about 2%. Activist investor Nelson Peltz said he would end his campaign against Disney.
Other companies that reported solid earnings results included Sonos, PepsiCo, Tapestry, Ralph Lauren, and Wynn Resorts, all consumer-driven companies that suggest the consumer is still spending money and remains on solid footing.
So far 63% of S&P 500 companies have reported fourth-quarter earnings results. Of those companies, 68% have beaten profit estimates by a median of 6%, while 63% have beaten revenue estimates by a median of 4%, according to Fundstrat.
Here's where US indexes stood at the 4:00 p.m. ET close on Thursday:
- S&P 500: 4,081.52, down 0.88%
- Dow Jones Industrial Average: 33,699.88, down 0.73% (249.13 points)
- Nasdaq Composite: 11,789.58, down 1.02%
Here's what else is happening this morning:
- Robinhood's board of directors authorized a plan to purchase FTX founder Sam Bankman-Fried's stake in the company worth more than half a billion dollars.
- Robinhood ended up down $57 million in a single day after a glitch let its trading app customers temporarily short a meme stock, according to company executives.
- Chinese e-commerce giant Alibaba is testing its own rival to ChatGPT, joining the tech race to tap into investors' frenzy over artificial intelligence products.
- Data from the Bloomberg Billionaires Index show the world's 10 richest people have added $139.8 billion to their net worth since the beginning of January, as stocks staged a comeback from a dismal 2022.
- Bank of America said Google has a long-term advantage when it comes to the competition that's heating up in search, which has been enabled by artificial intelligence integration between ChatGPT and Microsoft's Bing.
- PepsiCo's CFO said companies will shell out bigger dividends if President Joe Biden's plan to increase stock buyback taxes passes.
In commodities, bonds and crypto:
- West Texas Intermediate crude oil fell 1.01% to $77.60 per barrel. Brent crude, oil's international benchmark, dropped 1.18% to $84.09.
- Gold dropped 0.97% to $1,872.30 per ounce.
- The yield on the 10-year Treasury rose five basis points to 3.68%.
- Bitcoin fell 2.40% to $22,030, while ether dropped 2.72% to $1,579.