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Wall Street opened lower on Friday as consumer spending rose more than expected and PCE inflation turned hot.
At first and the Nasdaq Composite (COMP.IND) Rejected by 1.8%the S&P 500 (SP500) submerged 1.5%and the Dow (DJI) faded 1.3%.
The core PCE price index for January came in at +0.6%/m/m versus the consensus figure of +0.4%/m/m.
At the same time, January personal spending came in at +1.8% M/M compared to the expected level of +1.2% M/M. Personal income was also seen at +0.6% M/M vs. +1.0% M/M anticipated.
“Today is a sobering double anniversary as it marks 1 year since the day Russia invaded Ukraine and 3 years since the day we saw the first major covid-related selloff after Italian cases surged over the weekend. last week,” said Jim Reid of Deutsche Bank. . “In fact, aftershocks are still being felt every day in markets (good and bad). This has continued this week, with intraday volatility remaining high.”
The broader market snapped a four-day losing streak with buying at the close on Thursday. But the leading averages still look set for a losing week.
The S&P 500 (SP500) is down 1.6% ahead of trading on Friday. The Nasdaq Composite (COMP.IND) was down 1.7% and the Nasdaq 100 (NDX) was down 1.4%. The Dow Jones (DJI) has seen the most downward pressure, down 2%.
“There was some speculation that a part of the US post-noon rally (yesterday) was due to delta hedging effects as the S&P 500 traded through the 4000 level, and 0DTE (zero days to the expiration) were partially blamed,” Reid said. “There are increasingly higher trading volumes for options on their expiration days than in the past. These options may have been listed at any time, but trading activity has increased recently on options that expire on the expiration day.” The increase in interest in these contracts seems to be able to move the markets considerably in both directions.”
Additionally, January new home sales numbers came in at 670K compared to the economists forecast annual rate of 620K.
At the same time, Michigan’s February consumer sentiment revision came in at 67, above the consensus figure of 66.4.
Among active stocks, Beyond Meat (BYND) soared on guidance for the second half of the year. The square main block (SQ) also won.