The Nasdaq Composite led the market lower again on Friday, while the Dow Jones and S&P 500 traded well above the 1% drop. Shares continued to fall in the inflation report this morning, exacerbating weekly losses on major indices.
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Dow Jones today
The Dow Jones Industrial Average opened more than 550 points below before extending losses to more than 700 points. The blue chip index fell 2.2% while the S&P 500 fell 1.8%. Small caps struggled as Russell 2000 fell 2.9%. Technology-heavy Nasdaq led the way down 3.2%. The volume was much higher on the Nasdaq and the NYSE compared to the same Thursday.
As shares rebounded early on Friday, the indexes were on track to close lower this week. The Dow Jones and other major US indices moved below their 21-day exponential moving averages on Thursday, a bearish sign.
US stock market overview
Index Symbol Dow Jones Price / Loss Rate Change (0DJIA) 31565.14 -707.65 -2.19 S&P 500 (0S & P5) 3916.32 -101.50 -2.53 Nasdaq (0NDQC) 11371,45 82.45 -38.45 Russell (0.45 -3.82.0) FFTY) 31.20 -0.88 -2.74 Last update: 12:12 ET 10/06/2022
The consumer price index has risen further since 1981
Economic news played a major role in Friday’s sale. The Labor Statistics Office’s consumer price index rose 1% in May, the second largest jump since 2008, surpassed only by the March CPI rise. Economists expected the annual rate to remain stable. A year-on-year increase of 8.6% in May was higher than the 8.3% increase in April. It was also the highest since December 1981.
“Basically, everything is rising in cost. Base prices were up 0.6% for the second month in a row,” said Sal Guatieri, a senior economist at BMO Capital Markets. “The most depressing, after falling in the last three months, used car prices rose 1.8% in May (from the previous month). And rents are rising sharply due to sparkling house prices “. Guatieri warned that people are unlikely to see relief in energy, rents or food prices for some time.
The news only increased the data yesterday from mortgage buyer Freddie Mac. The mortgage lender reported on Thursday that the 30-year rate rose to 5.23% this week from 5.09% last week, well above a rate of 3% a year ago. Last month, the average rate exceeded 5% for the first time in more than a decade.
Looking ahead, investors are gearing up for next week’s Federal Reserve meeting, when the Fed is expected to raise its key debt rate by 50 basis points.
Outside Dow Jones: IBD 50 shares to watch
The leader of the IBD 50, Li Auto (LI), countered the trend and increased more than 1% in the first operations. The shares were among only a handful of names listed on the rise. On the downside, Builders FirstSource (BLDR) fell 7% in high volume and is now below support on the 50-day line.
Construction products manufacturer Atkore (ATKR) also traded lower. The shares lost 5% and triggered the 7% to 8% sell-off rule from a double-bottomed buying point of 112.34. The initial breakup was messy and has now failed twice. The stock was removed from the IBD classification.
Agricultural company Darling Ingredients (DAR) also activated the 7% sell signal on Friday after falling more than 6%. Shares fell after surpassing 85.02 points of purchase of a cup base with a handle this week. However, the stock is maintained, gaining support on the 50-day line.
The price of oil fell slightly, but remained above $ 120 a barrel. The oil and gas exploration firm HighPeak Energy (HPK) was also one of the few names on the IBD 50 that made a profit. Shares rose 2% at one point, but reduced gains to 0.2%. Meanwhile, the RS line of stocks reached a new high. HighPeak is currently 6% below a 38.31 entry.