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S&P drops on fears of prolonged inflation
STORY: U.S. stocks gyrated before ending mostly lower on Thursday, as investors worried inflation could remain elevated for longer than expected, which could prompt the Federal Reserve to hike interest rates more aggressively. The Dow finished a third of a percent lower. The S&P 500 ended down fractionally – settling within striking distance of confirming it entered a bear market – while the Nasdaq finished about flat but in positive territory.All three major indexes have whipsawed wildly in the last few sessions, often reversing initial rallies by the closing bell. CEO of WealthWise Financial Loreen Gilbert said the recent swings are indicative of a fragile investor psyche.”It has been quite a rout. If we look at the last week, 90% of the S&P 500 has been hit under pressure. And we continue to be in a bear market, and the bear is out growling right now. And for many investors, they don’t know what to do. They either panic, or they are paralyzed. But the real answer is to have lots of patience. In the middle of a bear market, investors need to have patience.”Market leading megacap names were the biggest drag on stocks Thursday, with Apple and Microsoft weighing the heaviest on the S&P 500.But some of the so-called FAANG stocks that have been battered this year ended higher, including Meta, Amazon and Netflix.Meme stocks rallied, with GameStop and AMC Entertainment posting big gains, while Beyond Meat ended 4% lower after a wild, up-and-down session that mirrored the broader market, following a disappointing earnings report on Wednesday.And shares of luxury accessories company Tapestry surged more than 15% after expressing confidence in a rebound in Chinese demand once health restrictions are lifted.Meanwhile, the Senate confirmed Jerome Powell for a second term as Fed Chairman, a widely expected move that paves the way for the former investment banker to continue leading the U.S. central bank as it confronts the highest inflation in 40 years.
