US stocks closed mixed on Wall Street on Thursday, offsetting early losses after banks reported lower earnings, dragging markets down.
The S&P 500 fell 11 points, or 0.3%, to 3,790. The Dow Jones Industrial Average was down 0.5% and the tech-heavy Nasdaq was up slightly up .03%. Banks were among the biggest losers on major indices following weak earnings and warnings from JPMorgan Chase.
US stocks later plungeddashed the hopes of That investors’ concerns will cool economic growth. Investors worry about aggressive action by the Fed and other central banks to pacify inflation at a four-decade high that could derail global growth.
Stephen Innes, of SPI Asset Management, said in a report, “Growth fears are hitting the markets harder than inflation concerns.”
The S&P 500 lost 0.4 percent on Wednesday. The Dow fell 0.7% and the Nasdaq Composite 0.2%.
Traders expect another Fed rate hike this month, perhaps matching last month’s 0.75 percent increase, the biggest in 28 years and more than three times the normal margin.
Bank stocks have taken heavy losses this year as investors worry about the Federal Reserve pouring out the US economyTo counter inflation. A recession would mean some Americans would lose jobs, and possibly start falling behind on their debts. These fears have more than offset the higher revenue earned by banks from higher interest rates.
Weak earnings reports also dragged bank stocks down. JPMorgan Chase’s profits fell 28% in the second quarter, the bank reported Thursday, as it tries to navigate an economy that is showing strength in many sectors but steamrolled amid rising interest rates. that affects consumers and businesses alike. Inflation at the wholesale level climbed 11.3% in June from a year ago. This follows a worrying report on Wednesday that prices remain high at the consumer level.
Fed officials say a recession is possible but not certain. they point to aDespite the high borrowing cost.
Taking a more critical stance, JPMorgan Chase CEO Jamie Dimon warned in a statement that while the US economy is growing and the job market and consumer spending are solid, many factors “are likely to have negative consequences on the global economy at some point in time.” the road,” including shrinking consumer confidence and the Federal Reserve’s efforts to bring decades-high inflation under control.
“US consumers are almost the only ones saving the global economy,” Andrew Hunter, senior US economist at Capital Economics, said in a research note in June.There are suggestions that consumers have started cutting back on their spending on goods and services. Experts said this could be the first indication that inflation could be very high.
Traders are looking forward to the latest quarterly results from major US companies in the coming weeks.
In energy markets, benchmark US crude tumbled $1.26 to $95.04 a barrel in electronic trading on the New York Mercantile Exchange. The contract rose 46 cents to $96.30 on Wednesday. Brent crude, the price base for international oil trade, fell $1.06 to $98.51 a barrel in London. It rose 8 cents to $99.57 a barrel in the previous session.