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Damien J. Trowers and Alex Veiga
NEW YORK – Wall Street stocks fell again on Thursday, but major indexes continued their weekly gains after two strong days of gains earlier this week.
The S&P 500 fell 0.8%. About three-quarters of stocks in the benchmark index ended in the red, with retailers, banks and industrial companies taking the biggest weight. The Dow Jones Industrial Average is down his 0.3% and the Nasdaq Composite is down his 0.6%. Small business stocks fell more than the market as a whole, with the Russell 2000 index he cut 1.2%.
U.S. Treasury yields continue to climb to multi-year highs, a trend that is pushing up rates on mortgages and other loans. Yields on 10-year US Treasuries rose to 4.23% from 4.14% late Wednesday, their highest level in 14 years. The two-year Treasury yield, which tends to track expectations for future Federal Reserve action, rose to 4.61% from 4.56%.
Investors are on Wall Street as investors seek a better picture of how companies are performing and how the economy is faring amid the heaviest inflation in 40 years. continues to focus heavily on corporate earnings.
Mixed earnings results
Earnings results to date have been mixed. While some large companies announced promising financial results, others let investors down with weak or worrying warnings.
“Our earnings growth estimate for the quarter is 3.6% higher than it was a year ago,” said Bill Norsey, senior investment director at U.S. Bank Wealth Management. Growth in the third quarter. So there was a significant downgrade in the level of expected earnings growth this year.
IBM rose 4.7% in the third quarter, beating analysts’ expectations for earnings and profits. AT&T also jumped 7.7% after reporting strong results.
Tesla fell 6.6% after saying it could not meet its vehicle shipment target for the year. Union Pacific fell 6.8% after rail operators forecast slower growth, suggesting the economy may be slowing.Rival CSX fell 3%. American Airlines fell 3.8% after releasing its latest results.
Allstate fell 12.9% after providing investors with disappointing financial information.
Overall, the S&P 500 fell 29.38 points to 3,665.78. The Dow Jones Industrial Average fell 90.22 points to close at 30,333.59. The Nasdaq dropped 65.66 points to 10,614.84. The Russell 2000 was down 21.36 points to 1,704.39.
Investors shrug off UK politics and focus on inflation and the economy
European markets closed higher. UK Prime Minister Liz Truss has resigned after several policy changes shook financial markets.
Investors continue to worry about inflation and the possibility of a recession around the world. Wall Street is particularly concerned about the Fed’s ongoing rate hike plans to slow economic growth and keep prices high. The US economy is already showing signs of slowing and the Fed’s plan risks slowing the economy and triggering a recession.
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The job market remains a strong sector of the economy, along with private consumption. The number of Americans applying for unemployment benefits fell last week and remains at a historically low level, according to the latest government data.
A healthy job market is a thorny problem for the economy as a whole. While positive, it also shows that the Fed must continue to aggressively raise rates. Fed officials have warned that the unemployment rate will likely have to rise as part of the fight against inflation.
interest rate hike
The central bank has raised key interest rates to a range of 3% to 3.25%. A little over six months ago, that percentage was close to zero. Rising interest rates are putting pressure on other areas of the economy, including the housing market.
A sharp rise in interest rates has pushed mortgage rates to their highest level in 15 years. Mortgage buyer Freddie Mac reported Thursday that his average 30-year interest rate rose from 6.92% last week to 6.94% this week. At this point last year, this rate was 3.09% for him.
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Rising mortgage rates are adding to the impasse in the housing sector after years of overheating. The National Association of Realtors said Thursday sales of previously occupied U.S. homes fell for the eighth straight month in September.
Homebuilders fell broadly following the latest home and mortgage interest rate reports. PulteGroup he fell 1.5%.
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