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Topline
Stocks plunged on Friday and hit new lows for 2022, wrapping up a brutal sell-off this month as investors continued to dump tech shares amid ongoing uncertainty around an economic slowdown caused by surging inflation and the prospect of aggressive interest rate hikes.
Stocks hit new lows for 2022 amid the ongoing tech sell-off in April. Eduardo Munoz Alvarez/Getty Images
Key Facts
The Dow Jones Industrial Average fell 2.8%, over 900 points, while the S&P 500 lost 3.6% and the tech-heavy Nasdaq Composite 4.2%.
The Nasdaq posted its worst month since October 2008, falling roughly 15% as tech stocks were among the hardest hit by sell-offs in recent weeks.
Both the Nasdaq and S&P 500 (down nearly 9% this month) hit new lows for 2022 as investors continue to face a myriad of uncertainties, from the Federal Reserve’s upcoming interest rate hikes and surging inflation to Covid-19 cases in China and the ongoing war in Ukraine.
Shares of tech giant Amazon became the latest to crater following weaker-than-expected first quarter earnings: The stock plunged 14% on Friday after disappointing results.
Shares of other tech stocks also moved lower, with Intel and Apple falling 7% and nearly 4%, respectively, amid gloomy outlooks that spooked investors.
Surprising Fact:
Of the 275 companies in the S&P 500 that have reported first quarter earnings so far, roughly 80% have beaten analyst expectations, according to Refinitiv data.
Crucial Quote:
“Disappointing guidance from technology giants, Amazon and Apple, have exacerbated concern that a decidedly more hawkish Fed, coupled with still intractable supply chain issues, and rising energy prices may make the hope of a ‘soft landing’ from the Fed more elusive,” says Quincy Krosby, chief equity strategist for LPL Financial.
Tangent:
Shares of electric-vehicle maker Tesla fell 0.8% on Friday after billionaire CEO Elon Musk sold another 5.2 million shares this week. He has now sold over $8 billion worth of Tesla stock in recent days as he looks to finance his $44 billion acquisition of social media company Twitter.
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