Wall Street plummets on inflation fears

Wall Street ended sharply lower as Amazon slumped following a dismal quarterly report and the biggest rise in monthly inflation since 2005 spooked investors already worried about rising interest rates. interest.

Amazon.com Inc tumbled in its biggest one-day drop since 2006, leaving the stock widely held near two-year lows.

Late Thursday, the e-commerce giant delivered a disappointing quarter and outlook, overwhelmed by rising costs for managing its warehouses and delivering packages.

Apple Inc, the world’s most valuable company, fell after its disappointing outlook eclipsed record quarterly profits and sales.

All 11 S&P 500 sector indices fell, led by consumer discretionary and real estate.

Disappointing earnings results and concerns about the Federal Reserve’s aggressive monetary policy tightening hurt megacap technology and growth stocks this month.

“Market participants are nervous initially, so there’s a quick trigger when it comes to these names when there’s uncertainty,” said Keith Buchanan, senior portfolio manager at Globalt Investments in Atlanta.

“When assumptions about how these companies will grow don’t materialize, there’s definitely a ‘shoot first and ask questions later’ mentality.”

The Nasdaq lost about 13% in April, its worst monthly performance since the 2008 global financial crisis.

Adding to Wall Street concerns, data showed the personal consumption expenditure price index – the US central bank’s preferred measure of inflation – jumped 0.9% in March after climbing 0. .5% in February.

The Fed is due to meet next week, with traders betting on a 50 basis point rate hike to combat soaring inflation.

Signs of aggressive monetary policy tightening, war in Ukraine and COVID-19 lockdowns in China fueled fears of an economic slowdown.

Thursday’s data showed the US economy unexpectedly contracted in the first quarter.

The S&P 500 lost 155.51 points, or 3.60%, to end at 4,132.94 points, while the Nasdaq Composite lost 533.40 points, or 4.14%, to 12,338.13 and the Dow Jones Industrial Average fell 937.80 points, or 2.77%, to 32,978.59. .

Exxon Mobil Corp slid after suffering a $3.4 billion (A$4.8 billion) writedown due to its exit from Russia.

Chevron Corp fell after its first quarter profit was disappointing.

Overall, the first quarter earnings season has been better than expected so far.

Nearly half of S&P 500 companies have released their report through Thursday and 81% of them beat Wall Street expectations.

Typically, only 66% exceeded estimates, according to Refinitiv data.

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