Daily market review

US seesaws lower; Europe off; Asia falls

United States

Equities ended mostly weaker Thursday in volatile trading with late dip buying helping the major indexes recover from afternoon lows. Sentiment remained fragile as the market's failure to rally has shaken confidence and global growth concerns multiply. The Dow Jones industrial average declined 0.3 percent, the S&P 500 eased 0.1 percent, and the NASDAQ was up 0.1 percent.

Stocks advanced through the morning but sellers stepped in again, as has been the recent pattern, sending the S&P 500 to new lows for 2022 before the late recovery. Risk appetite suffered from a new litany of negatives: the International Energy Agency's downgrade of global oil demand; Russia's threat to retaliate if Finland implements plans to join NATO, and new disputes over Russian energy supplies to Europe. Shaky company news provided more impetus for sellers as Disney fell 0.9 percent after an executive warned of slowing subscriber growth in the second half.

Weakness in megacaps weighed on the market, including Apple, down 2.7 percent, and Microsoft, off 2.0 percent. Weakest sectors included technology, with chipmakers seeing notable weakness, plus financials, energy, utilities, and industrials. On the positive side, Amazon managed to end 1.5 percent higher to help consumer discretionary hold up. Among Dow stocks, American Express fell 3.8 percent, and Boeing was off 4.9 percent.

Among companies in focus, Synchrony Financial dropped 6.5 percent after a downgrade at Wolfe Research. Beyond Meat, the food company, dropped 4.2 percent after reporting a wider than expected loss. On the positive side, Rivian, the electric vehicle maker, rallied 18 percent after raising its outlook.

Separately, in economic data, April US producer prices did slow but did not ease market concerns about inflation. The final-demand producer price index rose 0.5 percent in April, in line with expectations, after advancing 1.6 percent in March. The index rose 11.0 percent from April 2021, more than the 10.7 percent consensus expectation, but marking a slowdown from 11.5 percent in March.

These price data reflect observations at 4:00 PM US ET: Dated Brent spot crude oil rose US$1.10 to US$108.13 while spot gold fell US$31.01 to US$1,822.65. The US dollar rose vs. most major currencies. The US Treasury 30-year bond yield fell 1 basis point at 3.03 percent, and the 10-year note yield fell 4 basis points to 2.87 percent.

Europe

Equities weakened Thursday but ended well above their lows as investors focused on earnings news and hawkish central banks. Renewed US market declines weighed on European equities. The Europe-wide STOXX lost 0.8 percent, the French CAC declined 1.0 percent, the German DAX slipped 0.6 percent, and the FTSE 100 was down 1.6 percent.

Among sectors, basic resources and oil & gas lagged as commodities prices weakened amid concern about slowing growth. Industrials sagged with focus on Siemens, the industrial conglomerate, off 0.8 percent after an earnings miss and news it will exit the Russian market. Heidelberg Cement fell 4.9 percent on an earnings miss. Automakers lagged too with Renault down 2.3 percent after poor guidance from its partner, Nissan. Among financials, Hargreaves Lansdown lost 6.5 percent on weak guidance.

On the positive side, telecom outperformed with British Telecom up 1.9 percent after news it will merge its sports business with Warner Brothers Discovery. Telefonica, the Spanish telecom, rose 2.6 percent after topping earnings expectations.

Asia Pacific

Asian equities tracked US markets lower Thursday in a global risk-off move as investors took a bearish view of US consumer price report and the ongoing inflation problem.

Growth stocks led Japanese equities lower in line with Wednesday's NASDAQ losses with the Nikkei 225 down 1.8 percent and the TOPIX off 1.2 percent. Among sectors, information & communication, services, banks, and automakers lagged.

Chinese markets outperformed the region with only modest losses after the latest pledges of support from Chinese officials. China's CSI 300 index declined 0.4 percent and the Shanghai index eased 0.1 percent. Hong Kong's Hang Seng dropped 2.2 percent with internets and other tech stocks lagging.

Taiwan's TAIEX lost 2.4 percent South Korea's Kospi declined 1.6 percent as big cap tech names were hit. Indian equities followed the global risk-off trend with the BSE Sensex down 2.1 percent.

Rate hike and inflation fears hit Australian markets as All Ordinaries index dropped 1.9 percent. Worst performers included technology, consumer discretionary, and real estate investment trusts.

Looking ahead*

In Asia/Pacific, Chinese new yuan loans, Hong Kong GDP, and Indian merchandise trade figures are due. In Europe, French CPI and Eurozone industrial production reports are scheduled. In North America, US import & export prices and US consumer sentiment reports are on tap.

Global Stock Market Recap

Global Bond Market Recap

Global Currency Recap

Commodities and currencies

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