On Tuesday, the main US stock indices dropped considerably. Tech shares logged the biggest losses, as well as companies from the consumer goods and services sectors. On that day, traders were digesting earnings reports revealed by the leading US companies. They also assessed the possible consequences of the epidemiological situation in China. As a result, stocks had been falling throughout the day. However, by the end of the trading session, indices sank even more.
The S&P 500 lost 2.8%, falling to 4,175.20, while the Dow Jones Industrial Average dropped by 2.4% to 3,3240.18. The Nasdaq Compositedecreased by 4% to 12490.74. Therefore, all three indices may lose at least 4% by the end of April due to the prolonged downward movement in the stock market. The Nasdaq Composite stock, which notched the strongest one-day decline since the fall of 2020 on Monday, has already dived by 12% since the beginning of this month. Biggest gainers and losers On Tuesday, Amgen Inc. (+0.91%), Johnson & Johnson (+0.72%), and Chevron Corp (+0.61%) showed the best performance as companies included in the Dow Jones index. Nike Inc (-5,80%), Boeing Co (-5,04%), and Visa Inc Class A (-4,22%) logged the largest drops. The biggest gainers among firms comprised in the S&P 500 index were Sherwin-Williams Co (+9.41%), Waste Management Inc (+5.25%), and Whirlpool Corporation (+4.63%) The shares of Tesla Inc (-12,18%), General Electric Company (-10,34%), and Universal Health Services Inc (-9,69%) experienced a decline. Evoke Pharma Inc (+118.50%), Nutrex Health Inc (+73.76%), and Cyngn Inc (+52.07%) were among the companies with positive results included in the NASDAQ Composite index. The main outsiders were the shares of Protagonist Therapeutics Inc (-49.95%), Enjoy Technology Inc (- 29.95%), and Logic Bio Therapeutics Inc (-25.74%).
On the NYSE stock exchange, the number of shares that lost in price (2,710) exceeded the number of those that climbed (493). At the same time, 121 shares remained unchanged. On the NASDAQ stock exchange, stocks of 3,254 companies fell in price, while 616 showed gains, and 206 closed at the level of the previous session. The CBOE Volatility Index based on options of the S&P 500 index grew by 24.06% to 33.52, a new monthly high. What influenced the sentiment in the stock market? The main bearish factor is investors' concerns about a new spike of coronavirus in China and new lockdowns. The worsening epidemiological situation in the Asia-Pacific region has been weighing on Wall Street since the beginning of the week. As a result, it triggered volatility. The constantly rising inflation also affects the earnings reports of the leading US companies. The income of firms and households is rapidly declining. For this reason, the Fed is likely to tighten monetary policy at a faster pace. Besides, such a hawkish approach may also undermine global economic growth. Additionally, government bonds, which are traditionally considered safe-haven assets for investors, have recently been dropping due to inflationary pressure and the prospects of monetary policy tightening. On Tuesday, the yield of 10-year government bonds fell sharply to 2.773% from 2.825% on Monday. Yesterday, US investors also analyzed reports on the local economy. The Conference Board Consumer Confidence Index edged down in April to 107.3 from an upwardly revised reading of 107.6 in March. Analysts had expected an increase to 108. The US Department of Commerce reported that new home sales in March dampened by 8.6% on annual basis compared to February and amounted to 763,000. This indicator has been showing a negative dynamic for the third month in a row. Analysts had forecast a decrease in sales in March by only 0.9%. On Tuesday, traders also took notice of the latest earnings reports of the country's leading companies. Yet, even strong financial results could not boost market sentiment because of numerous bearish fundamental factors.
