Stocks fell Friday amid big bank earnings reports, rising inflation, and geopolitical tensions in the Middle East. The Dow Jones Industrial Average was down 557 points in late-afternoon trading, or 1.4%, to 37,902 shortly before markets closed. It ended the day 475 points, or 1.2%. The S&P 500 closed down about 1.4% and the Nasdaq dropped about 1.6%.
Despite a higher than expected inflation reading dashing investors’ hopes for lower interest rates this year, one Fed leader is still hoping for cuts. Federal Reserve Bank of Boston President Susan Collins is anticipating at least two rate cuts in 2024.
“I am still expecting that we’re going to see some slowing in demand start and continue into 2024, and that will help to bring inflation down later in the year,” Collins told Reuters.
BlackRock CEO Larry Fink said Friday that he also expects the Fed to cut interest rates at least twice this year — even if inflation stays above the central bank’s 2% target.
Intel and AMD stocks fall
Shares of Intel and Advanced Micro Devices (AMD) were down 5% and 5.8%, respectively, following a new report that Chinese officials told the country’s largest telecom companies earlier this year to stop using foreign core processors by 2027. Those companies included China Mobile and China Telecom. And that could be trouble for Intel and AMD.
Trump Media stock hits a new low
Shares of Trump Media & Technology Group, the company behind former President Donald Trump’s Truth Social, fell below $30 per share on Friday, hitting another new low since its debut on the Nasdaq last month.
Trump Media stock was down more than 5% midday Friday, trading at $30.88 per share — a slight recovery from a new post-merger low of $29.57 earlier in the day. The dip brought the company’s market value down to about $4.2 billion, halving the more than $8 billion market capitalization it saw in its first trading week.
Stocks dip on JPMorgan and other big bank earnings
Shares of JPMorgan Chase fell more than 5% following the bank’s first-quarter results.
The banking giant reported $41.9 billion revenues in the first quarter of 2024, up 9% from the same period last year and topping analysts’ projected $41.674 billion. JPMorgan also posted earnings per share (EPS) of $4.44, surpassing the $4.17 expected by analysts, according to estimates compiled by FactSet. In the first quarter of 2023, the bank saw earnings of $4.10 per share. But the bank gave somewhat downbeat guidance on its net interest income for the remainder of 2024.
JPMorgan CEO Jamie Dimon warned people to expect the unexpected in the economy. “We don’t really know what’s going to happen,” Dimon said in a call with analysts Friday.
Citigroup and Wells Fargo also beat Wall Street expectations when they reported quarterly earnings Friday morning, but their stocks also fell.
Globe Life stock edges back up after a short-seller report cuts it in half
Shares of Globe Life, one of Texas’ largest insurance providers, dropped more than 50%, following a short position taken by Fuzzy Panda Research that alleged potential fraud at the company. Globe Life denied the allegations, and the stock recovered some of its losses Friday morning.
The was hovering around $49 per share early Friday morning, down 53% over the course of a day. And the stock was back to about $53 by mid-morning, up 13% on the day but still down 40% over the course of about 24 hours. The stock collapse initially wiped out $5 billion in market cap.
Oil prices continue to rise
Israel is preparing for an imminent attack from Iran, The Wall Street Journal reports. That has sent oil prices higher.
The benchmark Brent crude futures price has risen to $91.86 a barrel, while the West Texas Intermediate gained 2.73% to $87.34 a barrel.
– Bruce Gil, Rocio Fabbro, and Britney Nguyen contributed to this article.