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Volatility Returns on Wall Street: Pre-Markets in Red
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After two strong days in the market for the Dow and S&P 500, we’re returning to a bearish stance in Tuesday’s pre-market: the Dow is -172 points at this hour, the S&P is -38 and the tech-heavy Nasdaq is -196 points. A warning from social media firm Snap (SNAP - Free Report) has lowered guidance for current quarter earnings and revenues, helping Nasdaq take a step lower.
Snap, the parent company of popular app Snapchat, issued a warning about its lowered forecast and slower pace of hiring moving forward, and has brought about its worst trading day since its IPO in early 2017 — down -34% in pre-market trading. It has also set the entire social media space into a downward spiral: Meta is -8% in early trading and Pinterest (PINS - Free Report) in -17%.
Best Buy (BBY - Free Report) is also down this morning, though not nearly as much, on its mixed Q1 earnings report out this morning: earnings of $1.57 per share came in 2 cents shy of the Zacks consensus, while quarterly sales of $10.65 billion topped estimates by 2.1%. Guidance was also lowered for the full fiscal year, helping shares down -2.5% this morning; the big-box retailer is already down -29% year to date.
After the market opens today, we’ll see new S&P Global PMI data for Manufacturing and Services. Both are expected to tick down in May from April’s relatively strong levels. We’ll also get a look at New Home Sales for April, which are expected to reach 750K for the month — down from the 763K reported in March.
This is notable because March was the first time in years the Fed raised interest rates; although near-term Fed funds is not directly correlated with 30-year mortgage rates, we are already seeing mortgages higher than they were in the first quarter on the year. Those in the home buying market were largely aware of this fact, and we may have seen a pull-forward of home buys in Q1 based on access to lower mortgage rates at that time.
It’s a little early to say the “whipsaw effect” is back in the day-to-day trading markets. But what we do see so far is companies giving somewhat negative news getting hammered, and associated companies taking a hit as well — therefore, we’re mindful that our near-term gains may be at immediate risk ahead of today’s opening bell.
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Volatility Returns on Wall Street: Pre-Markets in Red
After two strong days in the market for the Dow and S&P 500, we’re returning to a bearish stance in Tuesday’s pre-market: the Dow is -172 points at this hour, the S&P is -38 and the tech-heavy Nasdaq is -196 points. A warning from social media firm Snap (SNAP - Free Report) has lowered guidance for current quarter earnings and revenues, helping Nasdaq take a step lower.
Snap, the parent company of popular app Snapchat, issued a warning about its lowered forecast and slower pace of hiring moving forward, and has brought about its worst trading day since its IPO in early 2017 — down -34% in pre-market trading. It has also set the entire social media space into a downward spiral: Meta is -8% in early trading and Pinterest (PINS - Free Report) in -17%.
Best Buy (BBY - Free Report) is also down this morning, though not nearly as much, on its mixed Q1 earnings report out this morning: earnings of $1.57 per share came in 2 cents shy of the Zacks consensus, while quarterly sales of $10.65 billion topped estimates by 2.1%. Guidance was also lowered for the full fiscal year, helping shares down -2.5% this morning; the big-box retailer is already down -29% year to date.
After the market opens today, we’ll see new S&P Global PMI data for Manufacturing and Services. Both are expected to tick down in May from April’s relatively strong levels. We’ll also get a look at New Home Sales for April, which are expected to reach 750K for the month — down from the 763K reported in March.
This is notable because March was the first time in years the Fed raised interest rates; although near-term Fed funds is not directly correlated with 30-year mortgage rates, we are already seeing mortgages higher than they were in the first quarter on the year. Those in the home buying market were largely aware of this fact, and we may have seen a pull-forward of home buys in Q1 based on access to lower mortgage rates at that time.
It’s a little early to say the “whipsaw effect” is back in the day-to-day trading markets. But what we do see so far is companies giving somewhat negative news getting hammered, and associated companies taking a hit as well — therefore, we’re mindful that our near-term gains may be at immediate risk ahead of today’s opening bell.