Nasdaq loses 2% on third consecutive day of losses as tech stocks drag indices lower

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Nasdaq loses 2% on third consecutive day of losses as tech stocks drag indices lower

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Equities wiped out previous gains to close mostly lower, with investors looking forward to the Federal Reserve’s next monetary policy decision later this week amid an ongoing war in Ukraine and surging inflation. .

The Dow Jones Industrial Average erased previous gains by a whopping 451 points to end up unmodified by the close of the market. The Nasdaq was down 2% and the S&P 500 also turned negative due to renewed pressure on tech stocks. Crude oil prices in the United States (CL = F) fell below $ 103 a barrel to a two-week low, while the average pumped gas price held near a record above $ 4.30 on gallon in the United States

Meanwhile, Chinese equities remained volatile as concerns over regulatory pressures and Beijing’s relations with Russia increased further. According to reports over the weekend citing US officials, Russia had requested military support from China for the war in Ukraine. US depository receipts from major Chinese companies including Alibaba (BABA), Nio (NIO) and Baidu (BIDU) have slipped into intraday trading, building on heavy losses since the beginning of the year.

US investors this week have their sights set on the Federal Reserve’s latest monetary policy decision due to be released on Wednesday. Market participants expect the Fed to raise interest rates for the first time since 2018 as the central bank takes its first major step towards removing the monetary policy accommodation it had implemented over the course of the pandemic.

Prior to this meeting, Fed Chairman Jerome Powell already told Congress earlier this month that he would support a 25 basis point rate hike after the March meeting. Such a move would take rates a step above their current near-zero levels and only just start tackling inflation already soaring to multi-decade highs. However, many economists expect Fed officials to wire that they remain open to discussing more or more rate hikes in the future, especially if and when uncertainty about the geopolitical situation begins to subside.

“The debate between 25 basis points and 50 basis points in the coming months will also depend on the war in Ukraine. The war has raised energy prices, tightened financial conditions and reduced growth prospects abroad, which implies greater inflation and lower growth in the US, “Goldman Sachs Economist Jan Hatzius wrote in a statement on Sunday. “We suspect the FOMC will be reluctant to consider a 50 basis point hike until the downside risks to the global economy from the war diminish.”

“However, we don’t expect the war to drop the Fed from a tightening path of 25 basis points per meeting,” he added. The firm expects seven interest rate hikes to occur this year, followed by four in 2023. “With inflation likely to remain high throughout the year, the FOMC will likely only stop if it thinks further tightening will occur. you risk pushing the economy into recession “.

Amid rising inflation and geopolitical uncertainty, Goldman Sachs strategists also recently lowered their price target on the S&P 500. Strategists led by David Kostin said they now see the S&P 500 finish the year at 4,700, representing a 10% rise from Friday’s closing levels, against a previous target of 4,900. The company also sees the S&P 500’s earnings per share decelerate more sharply to increase by just 5% this year, compared to the 8% growth seen previously.

4:08 PM ET: Nasdaq dips 2% on third consecutive day of losses as tech stocks drag indices lower

Here are the main moves in the markets starting at 4:08 PM ET:

  • S&P 500 (^ GSPC): from -31.20 (-0.74%) to 4,173.11

  • Dow (^ DJI): +1.05 (+ 0.00%) to 32,945.24

  • Nasdaq (^ IXIC): from -262.59 (-2.04%) to 12,581.22

  • Raw (CL = F): from $ -7.40 (-6.77%) to $ 101.93 per barrel

  • Gold (GC = F): $ -28.90 (-1.46%) to $ 1,956.10 per ounce

  • Ten-year treasure (^ TNX): +13.6 bps for a yield of 2.1400%

2:59 PM ET: GameStop shares slide ahead of quarterly results

Shares of GameStop (GME), the original darling of last year’s Reddit-fueled retail frenzy, fell 16% intraday on Monday as investors sold riskier assets from meme stocks to stocks of loss-making tech companies. .

The latest drop added to year-to-date declines for the game retailer, which has now seen its shares plummet 46% in 2022.

GameStop will report quarterly results after the market close on Thursday, offering another update on the company’s latest results during the reopening and plans for its NFT market currently under development. Some analysts, however, remain bearish on GameStop’s new direction.

“GameStop confirmed the rumors last month and announced it has partnered with Australian startup Inmutable X to power its online hub on the Ethereum network,” Wedbush analyst Michael Pachter wrote in a statement Monday. He rates the stock as Underperform and has a 12-month price target of $ 45 each. “We remain skeptical that platform owners and large publishers will allow NFT trading in the game and we think GameStop’s strategy will fail.”

2:04 PM ET: Stocks go down

Here’s where the shares traded on Monday afternoon:

  • S&P 500 (^ GSPC): -35.36 (-0.78%) to 4,171.65

  • Dow (^ DJI): from -84.99 (-0.26%) to 32,859.20

  • Nasdaq (^ IXIC): from -244.79 (-1.91%) to 12,599.47

  • Raw (CL = F): from $ -7.77 (-7.11%) to $ 101.56 per barrel

  • Gold (GC = F): from $ -24.80 (-1.25%) to $ 1,960.20 per ounce

  • Ten-year treasure (^ TNX): +11.1 bps for a yield of 2.117%

11:16 am ET: US Consumer Inflation, Spending Expectations Rising: New York Fed

According to a survey by the New York Federal Reserve, consumers in the United States raised their expectations for one- and three-year inflation rates due to rising prices and said they now expect to spend more on food, gas and shelter in the coming year.

The survey showed that one-year inflation expectations rose to 6.0% in February compared to the expected rate of 5.8% in January. This matched the November level for the highest ever recorded in data dating back to 2013. Three-year inflation expectations also rose to 3.8% from 3.5% in January, although it was below the levels at the end. last year.

Spending expectations have also increased dramatically, with consumers now expecting their spending to increase 6.4% next year from 5.5% in January. This expected increase in spending also marked a record in the history of the New York Fed investigation.

10:47 AM ET: Berkshire Hathaway shares set a record intraday record

Berkshire Hathaway’s Class A shares jumped nearly 2% to set a record intraday high of $ 498,821.28 each Monday morning, as investors further accumulated in value shares to start the week.

A deposit over the weekend also showed that Berkshire Hathaway, the conglomerate led by billionaire investor Warren Buffett, doubled its bet on Occidental Petroleum (OXY). Berkshire bought an additional 27.1 million shares of the energy giant between March 9 and March 11 at prices ranging between $ 51.44 and $ 58.45 per share, the filing showed. The company now owns a total of over 118 million shares of Occidental Petroleum.

9:30 am ET: Mixed open scholarships

Here’s where the markets traded right after the opening bell on Monday morning:

  • S&P 500 (^ GSPC): +15.58 (+ 0.37%) to 4,219.90

  • Dow (^ DJI): +234.83 (+ 0.71%) to 32,179.02

  • Nasdaq (^ IXIC): from -32.71 (-0.25%) to 12,811.10

  • Raw (CL = F): from $ -5.07 (-4.64%) to $ 104.26 per barrel

  • Gold (GC = F): $ -20.10 (-1.01%) to $ 1,964.90 per ounce

  • Ten-year treasure (^ TNX): +8.6 bps for a yield of 2.094%

7:44 am ET Monday: Mixed stock futures, Dow futures earn over 250 points

Here’s where the shares traded on Monday morning:

  • S&P 500 futures (ES = F): +18.5 points (+ 0.44%) to 4,220.00

  • Dow futures (YM = F): +262 points (+ 0.8%) to 33,187.00

  • Nasdaq Future (QN = F): -20.5 points (-0.15%) at 13,271.50

  • Raw (CL = F): from $ -6.03 (-5.52%) to $ 103.30 per barrel

  • Gold (GC = F): from $ -23.60 (-1.19%) to $ 1,961.40 per ounce

  • Ten-year treasure (^ TNX): +7.2 bps for a yield of 2.078%

Traders work on the New York Stock Exchange NYSE in New York, US on March 9, 2022. US equities closed higher on Wednesday, rallying 3.59% to 13,255.55.  (Photo by Michael Nagle / Xinhua via Getty Images)

Traders work on the New York Stock Exchange NYSE in New York, US on March 9, 2022. US equities closed higher on Wednesday, rallying 3.59% to 13,255.55. (Photo by Michael Nagle / Xinhua via Getty Images)

Emily McCormick is a Yahoo Finance reporter. Follow her on Twitter

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