Stock Market Today Mid-Morning Updates
On Friday, the Dow Jones Industrial Average is down by 150 points. The Nasdaq fell for a third straight session, ending Thursday nearly 12% below its latest record close in November. Investors are also swapping out their growth and technology stocks that thrived in the early days of the pandemic. This along with investors jitters on the Fed’s plans to increase interest rates to combat raging inflation. However, IMF head Kristalina Georgieva says that the interest rate hikes by the Federal Reserve could throw cold water on the already weak economic recoveries in certain countries.
She says that an increase in U.S. rates could have significant implications for countries with higher levels of dollar-denominated debt. She also says that it was therefore hugely important for the Feds to communicate its policy plans to prevent surprises. In other news, Under Armour (NYSE: UAA) is up after Citi (NYSE: C) upgraded the stock to a Buy rating, saying that the company is emerging from the pandemic in a strong position in North America.
Among the Dow Jones leaders, shares of Apple (NASDAQ: AAPL) are down 0.33% today while Microsoft (NASDAQ: MSFT) is also down by 0.62%. Home Depot (NYSE: HD) and Nike (NYSE: NKE) however, ticked higher on Friday. Among the Dow financial leaders, Visa (NYSE: V) and Goldman Sachs (NYSE: GS) are trading lower at 0.30% and 0.78% respectively.
Shares of electric vehicle (EV) leader Tesla (NASDAQ: TSLA) are down by 2.06% on Friday. Rival EV companies like Rivian (NASDAQ: RIVN) and Lucid Group (NASDAQ: LCID) are also down by 1.58% and 1.98% today. Chinese EV leaders like Li Auto (NASDAQ: LI) and Xpeng Motors (NYSE: XPEV) are trading lower at 3.43% and 4.80% respectively.
Dow Jones Today: Treasury Yields And Jobless Claims Unnerving Investors?
Following the stock market opening on Friday, the S&P 500, Dow Jones, and Nasdaq are trading 0.72%, 0.52%, and 1.06% lower. Among exchange-traded funds, the Nasdaq 100 tracker Invesco QQQ Trust (NASDAQ: QQQ) is down by 1.33% on Friday, while the SPDR S&P 500 ETF (NYSEARCA: SPY) is up by 0.77%.
Today, the yield on the benchmark 10-year Treasury ticked below 1.8% on Friday morning. This comes after hitting 1.9% on Wednesday, with investors trailing on the Federal Reserve’s timeline for raising interest rates and broadly tightening monetary policy. Also, a pullback in central bank economic support measures along with rising inflation has pushed investors to sell out throughout the week.
Bitcoin And Cryptocurrencies Tumble
Bitcoin prices fell sharply yesterday, dropping to below $40,000 while Etherium prices also dived, wiping out nearly $150 billion from the crypto market. The declines in cryptocurrencies seem to follow Wall Street losses on Thursday. This goes against the investment case for Bitcoin serving as a hedge against rising inflation as a result of government stimulus. Analysts point out that the risk is that a more hawkish Federal Reserve may damper the prospects of investing in cryptocurrency.
Intel Reveals $20 Billion Plan To Expand Manufacturing Capabilities In Ohio
Intel (NASDAQ: INTC) could be worth keeping an eye on in the stock market today. This could be the case given the chipmaking goliath’s latest announcement. Notably, Intel is now looking to invest $20 billion in efforts to expand its chip manufacturing capabilities. In detail, this will take place via the construction of at least two semiconductor fabrication plants (fabs). Also, these fabs will be built on a 1,000-acre site nearby Columbus, Ohio. On top of that, Intel also currently has the option to expand on the current construction operation. This could ideally see the firm grow its construction project to up to 2,000 acres and eight fabs.
For the current plans, Intel is planning to begin construction of the first plant this year. Should things go smoothly, the firm sees the new facility beginning work by 2025. In an interview with Time magazine, CEO Pat Gelsinger also revealed Intel’s plans with the space. He starts by saying that Intel is aiming for it to be the largest fab globally. Additionally, he comments, “We helped to establish the Silicon Valley. Now we’re going to do the Silicon Heartland.”
Overall, the current move would be in line with the U.S.’s plans to increase domestic chip production figures. With the semiconductor shortages significantly impacting key markets like the automotive industry, this is understandable. As such, I could see investors eyeing INTC stock when considering possible long-term growth names in the market today. Now, INTC stock is currently gaining by 0.82%.
Netflix Slumps Over 20% On Disappointing Subscriber Growth Outlook
In other news, Netflix (NASDAQ: NFLX) is making waves in the stock market now after its latest quarterly earnings report. To begin with, the company’s top-line results are worth noting. Namely, Netflix posted earnings of $1.33 on revenue of $7.71 billion for the quarter. For earnings per share, the company smashed consensus projections of $0.82. Regarding quarterly revenue, it was mostly in line with Street estimates. However, the real metric investors seem to be focusing on now is the company’s latest subscriber growth figures.
In its latest quarter, Netflix added a total of 8.28 million subscribers, topping analyst forecasts of 8.19 million. This would mark a notable decrease from the 3.98 million subscribers it added back in Q1 2021. Moreover, the company also provided a less-than-ideal outlook for subscriber growth in the current quarter as well. According to Netflix, it will likely add 2.5 million new paying subscribers to its current base. This translates to less than half of forecasts of 6.93 million. Because of all this, NFLX stock is currently sliding by 23.23% as of today’s opening bell.
All in all, Netflix cites growing competition in the streaming space for this ‘safe’ guidance. Nevertheless, it is also important to note these results are in comparison to pandemic era peaks. As such, the sell-off in NFLX stock could make for a good entry point now.
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