US Stocks fell today in their worst loss since 2020.
The Wall Street Journal reports:
U.S. stocks fell sharply, with two of the major indexes suffering their worst day since 2020, as the latest set of disappointing earnings from large retailers raised investors’ fears of a recession.
The Dow Jones Industrial Average closed Wednesday down 1164.52 points, or 3.6%, to 31490.07, its lowest closing level since March 2021. The S&P 500 dropped 4%, or 165.17 points, to 3923.68, while the tech-focused Nasdaq Composite slid 4.7%, or 566.37 points, to 11418.15. The Dow and S&P recorded their worst percentage declines since June 11, 2020. The moves marked a U-turn from a day earlier, when technology shares led a rebound in markets.
Major retailers said their profits were hurt by rising costs, sluggish sales and supply-chain disruptions. Shares of Target sank 25%, or $53.67, to $161.61 after the company posted quarterly earnings that missed analysts’ expectations, its worst one-day performance since Black Monday in 1987. Shares of Dollar Tree, Dollar General and Costco Wholesale recorded their largest single-day percentage declines in years—in Costco’s case, since 2003.
The results are prompting Wall Street to wrestle anew with the idea that the global economy could be headed for a recession. Though that debate is far from settled, it has rattled stocks and other risky assets throughout the year, with the latest data illustrating the degree to which inflation has hit U.S. consumers.
“Inflation is hitting every aspect of an earnings report, whether it be the transportation side or supply-chain disruption,” said Nick Giacoumakis, president and founder of NEIRG Wealth Management. “Customers are no longer buying the more expensive items they would typically buy. All this trickles through to an earnings report.”
The US is close to if not in a recession right now. The last monthly high in GDP was in October of last year.
With inflation and 50-year highs and debt at all-time highs, the Biden economy is a mess. Former Trump economist, Kevin Hassett, says the US is gearing for a severe recession.
It’s really surprising the markets were that high with such a messed-up economy.