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Stock Market Today: Netflix Earnings Hit Tech Stocks, Bitcoin Tumbles









Wall Street is well on its way to closing a turbulent week with the Nasdaq firmly in correction.



Angela Weiss / AFP / Getty Images



Shares fell on Friday after unsatisfactory results




Netflix

get the market to the edge.



Dow Jones Industrial Average
futures fell by 90 points or 0.2%, raising the blue-chip benchmark to day 6 of the decline.


S&P 500
futures fell 0.5%, while tech-heavy


Nasdaq Composite
decreased by 0.8%. The S&P 500 and Nasdaq fell 1.1% and 1.3%, respectively.


Any chance of recovery from Thursday’s sell-off was thwarted by Netflix’s earnings report (ticker: NFLX). The streaming giant reported earnings of $ 1.33 per share, beating estimates of 82 cents per share with sales of $ 7.7 billion, in line with expectations. However, the company also announced fewer new subscribers, only 8.28 million in the fourth quarter of 2021, down from 8.5 million in the fourth quarter of 2020. Even worse, Netflix reached 2.5 million in the current quarter, which is significantly below analysts’ estimates of 6.93. million. Shares fell by 20%.

This unnerves investors in other Internet names facing consumers from the growth that was strong during much of the pandemic.




Amazon.com

(AMZN) fell by 1.1%, while




Pinterest

(PINS) decreased by 0.6% and




Meta platforms

(FB) decreased by 0.7%.

“If Netflix’s results are something that should go, big technologies can also be undermined,” wrote Craig Erlam, chief market analyst at Oanda. “Subscriber numbers have been a real blow and investors are forced to adapt to the reality that they are nowhere near the momentum expected over the past few years.”

Even before the release of Netflix, the Nasdaq was deep in the correctional territory as rising bond yields damaged technology stocks. Higher long-term bond yields reduce the value of future profits – and many technology companies are valued for making significant profits for many years to come. Long-term government bond yields fell on Friday and now they are more concerned about income.

The weakness in the stock market has spread to other risky assets. WTI oil futures fell more than 2% below $ 85 a barrel, causing the Energy Select Sector SPDR Fund (XLE) to fall 0.8%. Cryptocurrencies have also plummeted, with bitcoin down 8% to under $ 39,000 in the last 24 hours, according to CoinDesk. The smaller Peer Ether fell more than 9% below $ 2,900 over the same period.

As for oil, traders are preparing for a higher offer. As demand has risen sharply – and the price has risen by almost 30% since Omikron’s November low – oil producers are building up stocks. Oil reserves rose 515,000 barrels last week, according to the Energy Information Administration. Gasoline inventories increased by 5.9 million barrels.

The decline in cryptocurrencies is usually Russia, where they are popular among citizens. The country is also the center of mining – a process that generates new digital currency tokens. Russia’s central bank has proposed a ban on cryptocurrency mining as part of a broader ban that includes preventing people from trading or trading bitcoins.

New earnings reports elsewhere also reveal that inflation continues to cause companies to increase costs, damaging their profit margins. This just doesn’t help the stock prices of companies that haven’t reported yet. Several companies “reported higher costs as an impact on profitability, which supports margin concerns,” wrote Tom Essaye, founder of Sevens Report Research.

Sure, earnings results exceed estimates, but investors may demand even higher earnings than have been observed so far. According to Credit Suisse, the overall profit of the S&P 500 at the beginning of the fourth quarter exceeded expectations by 5.9%. According to Wells Fargo, the average share price response on the trading day after the gain was an increase of 0.3%.

Overseas, the pan-European Stoxx 600 fell 1.9% and the Tokyo Nikkei 225 fell 0.9%.

Here are five stocks on the move:




platoon

Shares (PTON) shot up 7%. Shares fell 24% on Thursday after a report that the company, which manufactures equipment for home exercise, including bicycles and treadmills, is stopping production. The CEO of the company rejected the report as untrue.






) shares fell 2.5% after the company reported earnings of 42 cents per share, beating estimates of 41 cents per share with sales of $ 3.4 billion, above expectations of $ 3.3 billion. Higher costs were part of the equation, and labor and ancillary costs increased $ 115 million year-over-year. Fuel costs doubled to $ 282 million. These higher costs caused the company’s operating profit margin to decline year-on-year.




PPG Industries

Shares (PPG) fell 2.3% after the company reported earnings of $ 1.26 per share, beating estimates of $ 1.20 per share with sales of $ 4.19 billion, above expectations of $ 4 billion. Its raw material costs increased by 30% year-on-year.




KB homepage

Shares (KBH) rose 0.3% after being upgraded to Buy from Neutral at Seaport Research Partners.




Devon Energy

(DVN) shares fell 3.6% after being reduced to neutral from Buy at




Goldman Sachs
.

Email Jack Denton at jack.denton@dowjones.com and Jacob Sonenshin at jacob.sonenshine@barrons.com

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