Bad day for tech stocks
Snap shock sends Nasdaq plummeting
05/24/2022, 11:40 p.m
Snapchat mother Snap corrects its forecast significantly downwards, whereupon investors also punish other providers in the industry. While the leading index Dow Jones Industrial just manages to break into the profit zone, the technology-heavy Nasdaq 100 is losing a lot of feathers.
The operator of the US messenger service Snapchat has shocked stock investors with a bleak outlook and sent the stock exchanges in New York plummeting. snap stocks a good 43 percent fell, making it stronger than ever. Of the Nasdaqindex fell 2.3 percent to 11,264 points. The broader one S&P 500 lost 0.8 percent to 3941 points. Of the Dow Jones-Index of standard values still turned into positive territory at the close of trading. It increased by 0.15 percent to 31,929 jobs.
Snap’s lowered expectations for the current quarter are an indication of the deteriorating economy and advertising business, said analyst Brent Thill of investment bank Jefferies. Titles of heavily advertising-dependent companies such as Twitterthe Google mother alphabet, MetaPlatforms and Pinterest slipped between five and 24 percent. “When the (economic) outlook is gloomier, ad spending will be reduced. This will put investors in a bad mood and create more storm clouds, just when many were hoping the market slump was about to bottom,” said Investment- Expert Russ Mold from wealth manager AJ Bell.
The investment experts at BlackRock stated that three developments are currently exacerbating investors’ concerns about the economy. “The even harsher rhetoric from the US Federal Reserve, reports of clouded earnings prospects at major US retailers and weak economic indicators from China.” Volatility in stock markets is likely to remain high ahead of Wednesday’s Fed minutes release, analysts at ActivTrades said. “An increasing number of investors and analysts are questioning the Federal Reserve’s current aggressive stance and are awaiting further details.” Trader Dennis Dick of brokerage Bright Trading said it must be clear that the rate hikes are counteracting high inflation without triggering a recession. “Until then, the market motto is ‘sell before ask,'” said trader Dennis Dick of brokerage Bright Trading.
shares of Abercrombie & Fitch fell about 28 percent after the clothing retailer lowered its sales outlook for the full year.
The shares of the fitness equipment provider nautilus slipped by around 19 percent. For the current quarter and the 2022/2023 financial year, Nautilus warned of results below market expectations. The industry environment remains difficult, commented analyst Mark Smith from the investment bank Lake Street. The trade is sitting on high inventories that were built up during the pandemic. The titles of the Nautilus rival peloton fell more than 8 percent.