Stock Market News Live Updates: Dow Drops Sharply as Big Wall Street Banks Report Profit Drops

Spread the love

US stocks closed mixed on Tuesday as a short but busy week full of corporate earnings began on Wall Street.

The Dow Jones industrial average (^DJI) lost nearly 400 points, or around 1.1%, pressured by bank stocks after Goldman Sachs (GS) posted its biggest loss of profit in a decade. The S&P 500 (^GSPC) closed the day down 0.2%, while the technology-heavy Nasdaq Composite (^IXIC) rose a modest 0.1%.

Goldman Sachs posted a larger-than-expected 69% decline in fourth-quarter earnings, weighed down by a substantial drop in trading revenue and a higher provision for credit losses. Shares fell 6.5%.

Morgan Stanley (MS), meanwhile, reported a smaller-than-expected drop in earnings. Like its Wall Street peers, the firm’s investment banking operations took a big hit, but higher net interest income and a record quarter for its wealth management business helped cushion overall numbers. Shares rose 5.8%.

The reports come after a lackluster round of quarterly updates from rivals late last week.

Earnings reports from other sectors will also pick up in the coming days, with United Airlines (UAL) reporting after the close.

Netflix (NFLX) numbers for Thursday are also in the spotlight. The update is likely to serve as a potential sign of things to come for tech sector results, which begin in earnest the following week.

The S&P 500 is expected to report a year-over-year decline in earnings of 3.9% for the fourth quarter, according to data from FactSet Research. This would mark the first year-on-year decline in earnings reported by the index since a 5.7% drop in the third quarter of 2020.

“We expect earnings to take center stage going forward, where earnings reactions have increased while inflation/FOMC reactions have decreased,” Bank of America’s Savita Subramanian and Ohsung Kwon wrote in a note on friday.

Traders work on the trading floor of the New York Stock Exchange (NYSE) in New York City, U.S., January 5, 2023. REUTERS/Andrew Kelly

World business leaders gather in the mountains of Davos, Switzerland, this week for the World Economic Forum. The prospect of a global recession, post-pandemic challenges, climate change and the crisis in Eastern Europe are about to top the agenda of the politicians, CEOs and billionaires in attendance. The president of the European Central Bank, Christine Lagarde, is among the attendees.

Next week will also be busy with Fedspeak, with several members of the US central bank set to deliver speeches across the country in the coming days.

US Treasury yields rose on Tuesday, with the benchmark 10-year note rising about 5 basis points to above 3.55%.

Oil rose, with West Texas Intermediate (WTI) crude oil futures rising 1.6% to trade above $81 a barrel.

Tuesday’s moves come after a long weekend in which the US stock and bond markets closed on Monday, January 16, in observance of Martin Luther King Jr. Day. On Friday, the three averages principales closed their second consecutive winning week.

The tech-heavy Nasdaq Composite posted a staggering 4.8% gain for the week, while the S&P 500 and Dow Jones Industrial Average posted their best results since November, posting weekly gains of 2.7% and 2%, respectively.

Alexandra Semenova is a reporter for Yahoo Finance. Follow her on Twitter @alexandraandnyc

Click here to see the latest stock price trends from the Yahoo Finance platform

Click here for the latest stock market news and in-depth analysis, including the events that move stocks.

Read the latest financial and business news from Yahoo Finance

Download the Yahoo Finance app to Apple either Android

Follow Yahoo Finance on Twitter, Facebook, instagram, flip board, LinkedInY Youtube


#Stock #Market #News #Live #Updates #Dow #Drops #Sharply #Big #Wall #Street #Banks #Report #Profit #Drops

Leave a Comment

Your email address will not be published. Required fields are marked *