Breaking News
Investing Pro 0
Cyber Monday Extended SALE: Up to 60% OFF InvestingPro+ CLAIM OFFER

Wall St posts third straight quarterly loss as inflation weighs, recession looms

Economy Oct 01, 2022 08:59
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
© Reuters. A trader works on the trading floor at the New York Stock Exchange (NYSE) in Manhattan, New York City, U.S., September 13, 2022. REUTERS/Andrew Kelly

By Stephen Culp

NEW YORK (Reuters) - The S&P 500 closed the books on its steepest September decline in two decades on Friday, skidding across the finish line of a tumultuous quarter fraught with historically hot inflation, rising interest rates and recession fears.

All three major indexes veered to a sharply lower end, having quashed a brief rally early in the session.

The S&P and the Dow notched their third consecutive weekly declines, and all three indexes posted their second straight monthly losses.

In the first nine months of 2022, Wall Street suffered three quarterly declines in a row, the longest losing streak for the S&P and the Nasdaq since 2008 and the Dow's longest quarterly slump in seven years.

"It's another ugly day to end an ugly quarter in what’s looking like a very ugly year," said Ryan Detrick, chief market strategist at Carson Group in Omaha, Nebraska. "Investors will look back and realize this was the year the Fed pulled a total 180 on their views on inflation and quickly turned incredibly hawkish."

The Federal Reserve has rattled markets by engaging in its most relentless series of interest rate hikes in decades in order to rein in stubbornly high inflation, which has many market participants eyeing key economic data for signs of a looming recession.

"The realization that the Fed is doing anything they can to combat 40-year-high inflation has investors worried they will push the economy over the edge and into recession," Detrick added.

The Commerce Department's personal consumption expenditures (PCE) report did little to assuage those fears, showing that while consumers continue to spend, the prices they are paying have accelerated, drifting further beyond the Fed's inflation target and all but ensuring the central bank's hawkish monetary policy will continue longer than investors had hoped.

Recession fears also echoed through dire warnings from Nike Inc (NYSE:NKE) and cruise operator Carnival (NYSE:CCL) Corp, both citing inflation-related margin pressures.

Shares of the companies tanked by 12.8% and 23.3%, respectively.

The Dow Jones Industrial Average fell 500.1 points, or 1.71%, to 28,725.51; the S&P 500 lost 54.85 points, or 1.51%, to 3,585.62; and the Nasdaq Composite dropped 161.89 points, or 1.51%, to 10,575.62.

Among the 11 major sectors of the S&P 500, real estate was the sole gainer, while utilities tech suffered the largest percentage losses.

Apple Inc (NASDAQ:AAPL), Microsoft Corp (NASDAQ:MSFT), Amazon.com (NASDAQ:AMZN) and Nike weighed heaviest.

Corporate earnings reports for the quarter that ends with Friday's closing bell will begin landing in a few weeks, and analyst expectations are trending downward.

Analysts now see annual S&P 500 earnings growth of 4.5%, on aggregate, down from the 11.1% estimate when the quarter began.

Quarter-end fund reallocations and so-called "window dressing" is likely contributed to the session's volatility.

Declining issues outnumbered advancing ones on the NYSE by a 1.45-to-1 ratio; on Nasdaq, a 1.38-to-1 ratio favored decliners.

The S&P 500 posted no new 52-week highs and 93 new lows; the Nasdaq Composite recorded 27 new highs and 380 new lows.

Volume on U.S. exchanges was 12.44 billion shares, compared with the 11.45 billion average over the last 20 trading days.

Wall St posts third straight quarterly loss as inflation weighs, recession looms
 

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind: 

  • Enrich the conversation
  • Stay focused and on track. Only post material that’s relevant to the topic being discussed.
  • Be respectful. Even negative opinions can be framed positively and diplomatically.
  •  Use standard writing style. Include punctuation and upper and lower cases.
  • NOTE: Spam and/or promotional messages and links within a comment will be removed
  • Avoid profanity, slander or personal attacks directed at an author or another user.
  • Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Continue with Google
or
Sign up with Email