© Reuters. FILE PHOTO: Traders work on the floor of the New York Stock Exchange (NYSE) in New York City, U.S., January 26, 2022. REUTERS / Brendan McDermid
By David French
(Reuters) – All three of Wall Street’s benchmarks ended higher on Wednesday, rising for a fourth straight session after a volatile start to the year, helped by solid earnings from Google’s parent Alphabet. NASDAQ 🙂 and chip maker Advanced Micro Devices (NASDAQ:).
But the mood looked sour in after-market trading as Facebook (NASDAQ:) owner Meta Platforms Inc stock fell as much as 22% after it missed Wall Street earnings estimates and forecasts. weaker than expected.
“It’s a sign of slowing growth and people don’t want to see that with growth stocks,” said Peter Tuz, president of Chase Investment Counsel in Charlottesville, Virginia.
Several other social media companies also fell on hard times after the bell, including Twitter (NYSE:), Pinterest (NYSE:) and Spotify (NYSE:), which also posted disappointing results at the end. The forth day.
In regular trading, Alphabet jumped 7.5% after reporting record quarterly revenue on Tuesday and said it plans to do a 20-to-one stock split – a move Neil Wilson has said. , Markets.com’s chief market analyst, said it should be done. more attractive to retail investors.
Meta was up slightly before the results, while Amazon.com Inc (NASDAQ:) was down 0.4% ahead of Thursday’s earnings report.
Last month, the tech-heavy Nasdaq fell as much as 19 percent from its November all-time high as investors dumped prized growth stocks on the prospect of faster-than-expected rate hikes. ants.
Traders are betting on five rate hikes this year following hawkish comments from the US Federal Reserve in January.
“There is a huge portion of the tech market and the bull market, which is commanding rather extreme multiples, may need a little bit of zero,” said Jason Pride, Chief Investment Officer of Private Finance at Glenmede. the gas comes out of the tyres,” adds Jason Pride, chief investment officer of private wealth at Glenmede. a “sane” move.
The one exception, he argues, would be the five or six biggest tech names, with more modest valuations and better fundamentals.
Tech earnings give the opportunity for this to happen, with ripple effects felt by peers.
Advanced Micro Devices Inc jumped 5.1% after the company on Tuesday forecast better-than-expected 2022 revenue, following strong quarterly demand for its semiconductors, despite declining global supply. reduction.
Positive sentiment extended to other chipmakers including Nvidia (NASDAQ: Corp, Qualcomm (NASDAQ:) Inc and Micron Technology Inc (NASDAQ:), up 2.5% to 6.3%.
However, PayPal Holdings Inc (NASDAQ:) fell 24.6% after first-quarter revenue and profit forecasts fell short of expectations.
As a result, other payments and financial technology companies were dragged down as well, with Block Inc, Affirm Holdings Inc and SoFi Technologies falling between 8.4% and 10.6%.
Overall, the only major S&P sector that ended lower was consumer discretion, down 0.5%. Communication services led the gainers thanks to Alphabet’s performance. It is also supported by Match Group Inc (NASDAQ:), up 5.3% as investors selected Tinder holders in the belief that the Omicron variant would not have as much impact on their business as previously feared.
Only discretionary consumers are lower, down xx%.
Up 224.09 points, or 0.63%, to 35,629.33, up 42.84 points, or 0.94%, to 4,589.38 and add 71.54 points, or 0.5%, up 14.417.55.
Markets in 2022 were already volatile, as investors sought to identify rising rates to tackle inflation, the lingering pandemic effects on the economy and geopolitical tensions in the region. Europe.
“Markets are trying to put all of this together,” Pride said. “It’s almost like a ‘deer headlight’ effect right now, where too much currents cross to try and triangulate on the fly.”
He added that the market is likely to recover in the immediate future, as investors digest these various inputs.
An unexpected drop in private payrolls on Wednesday helped keep US Treasury yields steady as investors weighed its potential impact on Friday’s broader jobs report.
Banks include JPMorgan Chase (NYSE 🙂 & Co, Citigroup Inc (NYSE:) and Bank of America Corp (NYSE:) lost ground, falling between 0.1% and 0.8%.
Volume on US exchanges was 11.06 billion shares, compared with an average of 12.43 billion for the full session over the last 20 trading days.
The S&P 500 posted 27 52-week highs and two new lows; Nasdaq Composite recorded 48 new highs and 67 new lows.
(Reporting by, Bansari Mayur Kamdar and Medha Singh in Bengaluru, David French and Alden Bentley in New York; Editing by Shounak Dasgupta and Lisa Shumaker)