Brendan McDermid/Reuters
Traders work on the floor of the New York Stock Exchange on October 27, 2023. REUTERS/Brendan McDermid
New York
CNN
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The benchmark S&P 500 index closed in correction territory on Friday, ending a week that was volatile due to weaker-than-expected earnings reports and strong economic data.
The S&P 500 fell 0.5%, marking a decline of more than 10% from its most recent peak in July. The Dow fell 367 points, or 1.1%, after falling more than 400 points at the trading session’s low. The Nasdaq Composite rose 0.4 per cent.
Amazon shares rose 6.8% on Friday after the e-commerce giant reported a hit to the top and bottom lines for its latest quarter. It comes after tech stocks fell earlier this week on mixed earnings reports from Alphabet and Meta Platforms, leading the Nasdaq Composite to log its worst day since February on Wednesday.
Still, earnings losses elsewhere helped accelerate this week’s market selloff.
Chevron shares lost 6.7% after the company reported a big loss in third-quarter earnings. ExxonMobil shares fell 1.9% after reporting third-quarter earnings that fell 54% from a year earlier.
Ford Motors shares fell 12.2% after reporting third-quarter earnings that missed Wall Street’s expectations and with Drew dropping its full-year outlook due to uncertainty stemming from the United Auto Workers’ strike. The union entered into an agreement with the car manufacturer earlier this week.
JPMorgan Chase shares fell 3.6% after a filing revealed that CEO Jamie Dimon and his family plan to sell $141 million worth of stock starting next year.
For the week, the Dow fell 2.1 percent. The S&P 500 fell 2.5% and the Nasdaq Composite lost 2.6%.
Key data this week showed the US economy continuing to remain strong despite interest rates at their highest level in 22 years, on investors who already fear the central bank will keep interest rates higher for longer.
Gross domestic product, a measure of all goods and services produced in the U.S. economy, rose at an annual rate of 4.9% during the third quarter, the Commerce Department reported Thursday. That measure, adjusted for inflation and seasonality, came in well above the second quarter’s 2.1% pace and economists’ expectations for a 4.3% rate.
Investors also digested the latest price index for personal consumption expenditures, the Federal Reserve’s preferred gauge of inflation. Excluding gas and food prices, the core PCE index rose 3.7% for the 12 months ended September, its smallest year-over-year increase since May 2021. The index rose 0.3% on a monthly basis from 0.1 % in August .
Traders see a nearly 100% chance that the Fed will keep interest rates steady after its monetary policy meeting next week, according to the CME FedWatch Tool.
The University of Michigan’s latest consumer survey also revealed on Friday that sentiment fell 6% this month as Americans grew increasingly worried about the economic outlook.
As stocks fall after the trading day, the levels may change slightly.