Beyond Meat is slipping
Wall Street is running out of steam
10/14/2022 11:43 p.m
After the previous day’s rally, disillusionment spread on Wall Street over the course of Friday. One of the reasons for this is the gloomy quarterly reports from the major investment banks. Shareholders were even more disappointed by meat substitute provider Beyond Meat.
Earnings declines at the big US money houses have clouded the mood on Wall Street at the end of the week. In addition, retail sales surprisingly stagnated in September, which experts attributed to high inflation and rising interest rates. Of the Dow Jones Index the standard values closed 1.3 percent lower on Friday at 29,634 points. The tech-heavy one Nasdaq fell 3.1 percent to 10,321 points. The broad one S&P 500 lost 2.4 percent to 3583 points.
JPMorgan, MorganStanley, Citigroup and Wells Fargo all earned less over the past quarter as the stock market turmoil paralyzed investment banking and increased funds had to be allocated to cover loan defaults. However, price reactions varied. A surprisingly significant drop in profits sent Morgan Stanley down more than five percent. At JP Morgan, however, stockbrokers had expected even worse: the papers gained 1.7 percent.
Analysts now expect third-quarter earnings for S&P 500 companies to rise just 3.6 percent year-on-year, much less than the 11.1 percent increase expected in early July, according to data from Refinitiv.
Fears of a recession weighed on commodity prices. North Sea grade oil Brent fell three percent to $91.75 a barrel, US light oil STI lost 3.8 percent to $85.77. Losers in the Dow were shares of the oil giant chevronswhich dropped more than three percent. ExxonMobil fell 2.6 percent.
Another forecast reduction set Beyond Meat to. The shares of the provider of meat substitute products slipped by almost ten percent. Due to weakening demand, the company only expects total annual sales of 400 to 425 instead of 470 to 520 million dollars. It also announced that 200 of the approximately 1,100 jobs would be cut.
The situation on the British financial market remained tense. Because the government’s debt-financed tax proposals have led to turbulence on the capital markets, Prime Minister Liz Truss dismissed Finance Minister Kwasi Kwarteng on Friday and partially relaxed the plans. Investors reacted with uncertainty and joined in Pound Sterling Cash. The currency fell as much as 1.5 percent to an intraday low of $1.1155 after gaining around five US cents in the past few days. They went on a roller coaster ride UK bond prices. The yield on the 10-year paper first dipped and then rose to 4.319 percent. The Bank of England (BoE) plans to end its recent bond purchases to support financial markets on Friday.