US close: Stocks weaker after Meta numbers seriously disappoint
By Josh White
Date: Friday 04 Feb 2022
(Sharecast News) - Wall Street's indices closed in negative territory on Thursday, with the tech-heavy Nasdaq leading the losses, as market participants thumbed over another round of corporate earnings and a number of fresh data points.
At the close, the Dow Jones Industrial Average was down 1.45% at 35,111.16, as the S&P 500 lost 2.44% to 4,477.44 and the Nasdaq Composite was off 3.74%.
The Dow closed 518.17 points lower on Thursday, more-than-erasing the gains it recorded in the previous session.
"The growing optimism of the past few days has been rudely shattered by Meta's terrible earnings," said IG chief market analyst Chris Beauchamp.
"The shock is weighing on market sentiment, although of course the Nasdaq is the hardest hit.
"Investors thought that they could breathe more easily as earnings remained solid, but the sight of one of the market's darlings suffering a brutal fall from grace has diminished the appetite of many to buy the dip."
On the macro front, new first-time jobless claims fell by 23,000 to 238,000 in the week ended 29 January, according to the Labor Department, for the lowest reading in three weeks and below economists' expectations for a print of 245,000.
Continuing claims fell by 44,000 to 1.628m in the week ended 22 January.
However, the four-week moving average, which strips out week-to-week volatility came in at 255,000, its highest reading since mid-November 2021.
Also in data news, job cuts increased slightly to 19,064 in January but were still 76% lower than the same month in 2021, according to Challenger, Grey and Christmas, as Omicron likely weighed on numbers last month.
Elsewhere, a final reading of IHS Markit's composite PMI was revised slightly higher to 51.1 in January from a preliminary reading of 50.8, while the services PMI rose to 51.2 from the flash estimate of 50.9.
Factory orders, meanwhile, fell 0.4% in December, according to the Commerce Department, and the Institute for Supply Management's non-manufacturing PMI fell 1.2 percentage points in January to 57.6%, indicating expansion in the overall economy for the 20th month in a row after a contraction in April and May 2020.
Finally, unit labour costs in the US undershot economists' forecasts by a wide margin at the end of 2021 as productivity growth surged.
According to the Department of Labor, unit labour costs increased at a quarterly annualised pace of 0.3% in the fourth quarter.
Labour productivity, on the other hand, jumped at a 6.6% pace, well ahead of consensus estimates for a reading of 2.3%.
In equities, market participants were looking over Facebook parent company Meta's overnight update early on Thursday, with the results revealing that quarterly profits fell short of expectations as it also issued weaker-than-expected revenue guidance for the current quarter.
Meta Platforms plunged 26.39% by the end of trading.
Spotify Technology tumbled 16.76%, after the streaming giant revealed a slowdown in premium subscriber growth overnight, as it battled a public relations crisis surrounding Covid-19 misinformation spread by its in-house Joe Rogan Experience podcast.
Cosmetics giant Estee Lauder was 5.03% weaker even after it raised its full-year forecasts on the back of heightened demand for skincare and make-up, while the Carlyle Group slid 7.77% despite its fourth-quarter earnings rising almost 400%, following record asset sales.
Eli Lilly reversed earlier gains to close down 2.4%, after its quarterly earnings beat expectations on the back of more than $1.0bn in Covid-19 antibodies revenue, while Biogen lost 2.13% after it issued some disappointing guidance with its latest earnings.
Merck was down 3.66% after it also provided guidance that was short of estimates.
On the upside, Ralph Lauren added 3.53% after the fashion brand smashed earnings and revenue estimates, and raised its full-year outlook.
Dow Jones - Risers
Unitedhealth Group Inc. (UNH) $488.77 1.87%
Procter & Gamble Co. (PG) $164.14 0.95%
Coca-Cola Co. (KO) $61.61 0.70%
International Business Machines Corporation (CDI) (IBM) $137.78 0.39%
Walmart Inc. (WMT) $140.99 0.10%
Dowdupont Inc. (DWDP) $30.52 0.00%
Honeywell International Inc. (HON) $230.94 0.00%
Johnson & Johnson (JNJ) $172.76 -0.01%
Verizon Communications Inc. (VZ) $53.79 -0.02%
American Express Co. (AXP) $184.04 -0.07%
Dow Jones - Fallers
Salesforce.Com Inc. (CRM) $212.77 -5.44%
Microsoft Corp. (MSFT) $301.25 -3.90%
Merck & Co. Inc. (MRK) $79.01 -3.66%
Intel Corp. (INTC) $48.28 -2.48%
Home Depot Inc. (HD) $364.81 -2.39%
Nike Inc. (NKE) $145.31 -2.29%
Amgen Inc. (AMGN) $224.04 -2.14%
Caterpillar Inc. (CAT) $200.59 -2.12%
Walt Disney Co. (DIS) $140.03 -1.82%
Walgreens Boots Alliance, Inc. (WBA) $49.50 -1.81%
S&P 500 - Risers
Dxc Technology Company (DXC) $34.91 13.75%
Humana Inc. (HUM) $426.21 6.23%
Becton, Dickinson & Company (BDX) $270.58 5.42%
Discovery Inc. Class A (DISCA) $28.93 4.48%
Discovery Inc. Class C (DISCK) $28.61 4.34%
Ralph Lauren Corp (RL) $117.68 3.53%
McKesson Corp. (MCK) $267.42 3.47%
Centene Corp. (CNC) $81.53 3.44%
Allstate Corp (The) (ALL) $121.67 3.38%
Boston Scientific Corp. (BSX) $42.61 2.82%
S&P 500 - Fallers
Meta Platforms Inc. (FB) $237.76 -26.39%
Qorvo, Inc. (QRVO) $128.72 -10.33%
Amazon.Com Inc. (AMZN) $2,776.91 -7.81%
Fortive Corporation (FTV) $66.05 -7.78%
Skyworks Solutions Inc. (SWKS) $138.54 -6.69%
Texas Instruments Inc (TXN) $175.59 -6.52%
Lincoln National Corp. (LNC) $67.26 -6.27%
Paypal Holdings Inc (PYPL) $124.30 -6.24%
Microchip Technology Inc. (MCHP) $74.17 -6.16%
Abiomed Inc. (ABMD) $290.52 -5.66%
Nasdaq 100 - Risers
T-Mobile Us, Inc. (TMUS) $120.78 10.22%
Check Point Software Technologies Ltd. (CHKP) $126.68 2.43%
Charter Communications Inc. (CHTR) $610.45 1.70%
Vodafone Group Plc ADS (VOD) $18.18 1.68%
Hologic Inc. (HOLX) $73.34 1.66%
Idexx Laboratories Inc. (IDXX) $538.95 0.88%
Marriott International - Class A (MAR) $162.01 0.71%
Citrix Systems Inc. (CTXS) $102.25 0.16%
Illumina Inc. (ILMN) $356.66 0.12%
Electronic Arts Inc. (EA) $137.29 0.09%
Nasdaq 100 - Fallers
Meta Platforms Inc. (FB) $237.76 -26.39%
Amazon.Com Inc. (AMZN) $2,776.91 -7.81%
Mercadolibre Inc. (MELI) $999.74 -7.65%
Skyworks Solutions Inc. (SWKS) $138.54 -6.69%
Texas Instruments Inc (TXN) $175.59 -6.52%
Paypal Holdings Inc (PYPL) $124.30 -6.24%
Microchip Technology Inc. (MCHP) $74.17 -6.16%
Asml Holdings N.V. (ASML) $645.93 -5.94%
Netflix Inc. (NFLX) $405.60 -5.56%
KLA-Tencor Corp. (KLAC) $373.68 -5.51%
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