Dow falls 600 points in final minutes of trading as January rally loses steam

Traders work on the floor of the New York Stock Exchange during morning trading on January 17, 2023 in New York City.

Michael M. Santiago | Getty Images

The Dow Jones Industrial Average fell more than 600 points on Wednesday as investors took profits on some of the strong gains in January in 2023 and as a disappointing December retail sales reading raised fears of a recession. Shares in banks led the losses.

The Dow Jones Industrial Average fell 61[ads1]2 points, or 1.8%, while the S&P 500 lost 1.6%. The Nasdaq Composite lost 1.2% and was on course for its first down day in the last eight.

Yung-Yu Ma, investment strategist at BMO Wealth Management, attributed the reversal to a combination of panic and profit-taking.

“We’ve had such a strong start to the year, but now we’re in the midst of a tense earnings season, recently had weaker data — retail sales and yesterday’s Empire State Manufacturing Survey. Plus the Feb. 1 Fed meeting looms large,” he said. “There is not much reason to get aggressive here, but all of these factors above suggest that caution is warranted in the near term.”

Dow Jones Industrial Average Wednesday

Microsoft announced plans to lay off around 10,000 employees, hurting investor sentiment. The stock fell, dragging the Dow lower with it.

Investors also digested the latest retail sales data, which showed a 1.1% fall in December, slightly more than the 1% forecast.

They also weighed the latest reading on the producer price index, which measures input costs from businesses. PPI showed a decrease of 0.5% for December. Economists surveyed by Dow Jones expected a decline of 0.1 percent. It briefly brought relief to investors who have been hoping that inflation will recede and that the Federal Reserve will slow its interest rate hike campaign.

Investors have enjoyed strong upward momentum for stocks since the start of the year, although many have begun to doubt the strength of the market. The Dow is still up 1% for the month, while the S&P and Nasdaq are still up 3% and 5%, respectively.

Source link

Back to top button

mahjong slot