Stocks turned from green to red on Thursday as interest rate fears swelled again on Wall Street.
Federal Reserve Chairman Jerome Powell has sent the latest signal that the next central bank rate hike could be imminent and bigger than usual. Powell told an International Monetary Fund panel that it was “appropriate in my view to move a little faster” to raise interest rates, adding: “I would say 50 basis points will be on the table for the May meeting.
The yield on the 10-year cash flow jumped in response from 2.836% to 2.954%.
Initial jobless claims for the week ended April 16 came in at 184,000 – slightly higher for estimates of 182,000, but still historically low and below the revised 186,000 from the previous week.
“That said, employment measures have taken a back seat to inflation and interest rate hikes, so today’s reading is unlikely to move the needle for the market,” said Mike Loewengart, managing director of investment strategy for E*Trade.
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Corporate earnings did little to reverse the trend. You’re here (TSLA, +3.2%) surged after posting a record $3.3 billion overall profit and easily beating analysts’ consensus earnings estimates. It was the same AT&T (T, +4.0%) despite shortfalls in overall turnover; That said, core revenue from its wireless business grew 2.5% in the first quarter.
But the major indices have not followed suit. Dive into Communication Services (-2.8%) and Technology (-1.8%) weighed the most on Nasdaq Compound (-2.1% to 13,174), even if the S&P500 (-1.5% to 4,393) and Dow Jones Industrial Average (-1.1% to 34,792) also suffered significant declines.
Other news on the stock market today:
- Small cap Russell 2000 fell 2.3% to 1,991.
- U.S. crude oil futures ended their highs but still improved 1.6% to $103.79 a barrel.
- Gold Futures Contracts slid 0.4% to $1,948.20 an ounce.
- Bitcoin also lost more than all of its morning gains, dropping slightly to $41,207.81. (Bitcoin trades 24 hours a day; prices shown here are as of 4 p.m.
- carvana (CVNA) fell 10.1% after the online used-car dealership reported a loss of $2.89 per share in the first quarter, higher than the loss of $1.58 per share expected by analysts. The company, however, beat out the top spot, grossing $3.5 billion against a consensus estimate of $3.4 billion. “Carvana is facing several industry-wide and company-specific headwinds that are impacting volumes and unit margins,” said Stifel analyst Scott Devitt, who reiterated a note from purchase on CVNA stock. “While short-term trends are in question, we believe the long-term thesis remains intact as the company continues to capture market share and build the assets needed to achieve meaningful leverage at scale. .”
- Airline stocks gained momentum after positive earnings from United Airlines Holdings (ALU, +9.3%) and American Airlines Group (ALA, +3.8%). While United missed both revenue and profit in the first quarter, the company said it expects to report its highest quarterly revenue and return to profit in the second quarter. American also reported a larger loss per share than analysts had expected in the first quarter, but it beat earnings and said it expects to post pretax profit in the second quarter. CFRA Research analyst Colin Scarola maintained a strong buy rating on UAL, saying its shares are “materially undervalued.” The analyst also maintained a Hold rating on AAL. “Low efficiency, much higher debt and a negative free cash flow history in 2017-19 leave us preferring AAL’s peers to invest in post-pandemic travel recovery,” Scarola wrote in a note.
The latest market ideas can be found in new ETFs on Wall Street
Have you ever found yourself in an investment rut? Well, if you’re looking for new investment strategies to tickle your brain cells, turn your eyes to the exchange-traded fund (ETF) industry, where there’s always something new.
Indeed, more than 100 ETFs have been launched so far in 2022 as the industry sucks up an ever-growing pool of cash – globally, ETFs have attracted $305.6 billion in net inflows during the first quarter, marking the second highest total behind only the first quarter of 2021. record of $361.1 billion. This count also follows the record annual consumption of 2021.
“Given consecutive record calendar years of net inflows, it’s no surprise that the ETF offering has expanded,” says Todd Rosenbluth, head of research at ETF Trends.
Our top ETF recommendations, such as the Kip ETF 20 and Best ETFs for 2022, are mostly built around established funds and seasoned with occasional newcomers. But brand-new ETFs, while unproven, are also worth watching given that many of them tend to feature new investment strategies, emerging industries, or less costly to achieve traditional portfolio goals.
Read on as we highlight nine notable new ETFs hitting the market in 2022.