OVERVIEW
MANAGEMENT
PERFORMANCE
POSSIBILITIES
CAPITALS
ACTIVITIES
ACTORS
BURGESS
|
INVESTMENT
NEW YORK STOCK EXCHANGE PERFORMANCE Dow drops 200 points Friday as bank stocks get hit, market posts second losing week to start 2022 
Original article: https://www.cnbc.com/2022/01/13/stock-market-futures-open-to-close-news.html Peter Burgess COMMENTARY I have been worried about the excessive 'financialization' of the modern economy for a long time ... and it has become worse and worse over time. Part of this is caused by bankers and economists who have an inadequate understanding of how their respective areas function and history. All of this is aggravated even more by basic ignorance on the part of many legislators about how the socio-enviro-economic system works. To the extent that policy is driven by politics and not the fundamental realities of how the socio-enviro-economic system actually works, results will not be good. Since 1980, there has been strong GDP growth at the national level and the stock market has increased in value. This has been considered a great success but the metrics are deeply flawed. While at the aggregate level there has been success, the different components of both GDP and the stock market have performed significantly differently. Quality of life for a few has improved in a spectacular way while for the majority of people quality of life has flatlined or worse. For society, growing inequality has been reported on for at least 30 years, but rather little has been done to change the trajectory of this growing problem. For the environment, all sorts of existential issues have been described for even longer, and again, little has been done to change the trajectory of the many issues that need attention. Investor behavior is going to be the key to changing the trajectory from one where maximum financial profit is the goal to one where there is a healthy balance between economic or profit performance and impact on society (people) and impact on nature (environment). Peter Burgess | ||
|
Dow drops 200 points Friday as bank stocks get hit, market posts second losing week to start 2022
Jesse Pound @JESSERPOUND and Pippa Stevens @PIPPASTEVENS13 PUBLISHED THU, JAN 13 2022 6:02 PM EST Major bank stocks declined after their earnings reports on Friday, weighing on the U.S. markets as Wall Street notched a second straight negative week to start the year. The Dow Jones Industrial Average slid 201.81 points, or 0.56%, to 35,911.81. The S&P 500 inched up 0.08% to 4,662.85, while the tech-heavy Nasdaq Composite outperformed with a 0.59% gain to close at 14,893.75. Bank stocks, which had outperformed in recent weeks as interest rates moved higher, were broadly lower as their reports appeared to underwhelm investors despite strong headline numbers. JPMorgan Chase, the No. 1 U.S. bank by assets, showed profit and revenue that topped estimates, but shares fell more than 6%. The company’s earnings were helped by a large credit reserve release, and CFO Jeremy Barnum warned that the company would likely miss a key profit target in the next two years. Citigroup’s stock fell nearly 1.3% after the bank beat revenue estimates but showed a 26% decline in profits. Shares of Morgan Stanley and Goldman Sachs, which report next week, also declined. Meanwhile, shares of Wells Fargo added close to 3.7% after the bank’s revenue topped expectations. CEO Charles Scharf said in a release that loan demand picked up in the second half of the year. “The one thing that really jumps out is expense growth. You saw that in both Wells Fargo’s and JPMorgan’s numbers,” Gerard Cassidy, large cap bank analyst at RBC Capital Markets, said on “Squawk on the Street.” Wells Fargo already had plans for future cost-cutting, which might explain its outperformance on Friday, Cassidy said. Shares of Netflix jumped more than 1% after announcing a price increase for U.S. and Canadian subscribers, helping the Nasdaq outperform on Friday. Casino stocks were another bright spot on Friday after Macau’s government announced it would allow just six casino licenses in the gambling hub. Las Vegas Sands surged 14.1%, while Wynn Resorts gained 8.6%. Oil stocks also outperformed as crude prices rose. On the data front, retail sales were down 1.9% in December, a worse reading than the 0.1% drop expected by economists surveyed by Dow Jones. January’s preliminary consumer sentiment reading from the University of Michigan came in lower than expected as Americans reported higher long-term inflation expectations. Consumer discretionary stocks were under pressure after the report, with Bath & Body Works and Under Armour falling more than 2%. Shares of Peloton fell nearly 2.6% after Nasdaq announced that the stock would be dropped from the Nasdaq 100 index. “The recent spread of the Omicron variant likely weighed on sales, but other factors also could be at work. Supporting the idea that this wasn’t all a COVID story, consumers likely shift shopping from in-person to online when the virus spreads, but nonstore sales plunged 8.7% in December,” JPMorgan economist Daniel Silver said in a note to clients. It has been a rocky start to 2022 for investors. Tech stocks fell sharply in the first week of the year as the Fed signaled a more aggressive approach to inflation, accompanied by a spike in interest rates. Both of those moves partially reversed course earlier this week but had snapped back by Friday afternoon. For the week, the Nasdaq shed 0.28%, while the Dow and S&P 500 lost 0.88% and 0.30%, respectively. This marked the third negative week in a row for the Nasdaq. “There’s a thought that the pricing in of a more hawkish Fed is a process, and not a week. Although a lot got done last week, this is going to be a process, and I think we’re probably going to have more volatile days in tech and growth stocks in general this quarter,” said Alicia Levine, head of equities, capital markets advisory at BNY Mellon Wealth Management. “The first quarter should be rising yields, rising rates, outperformance of cyclicals, and we think that the long-duration growth names are going to have a challenging quarter,” Levine added. Stock picks and investing trends from CNBC Pro:
In other data news, business inventories for November came in higher than expected, but industrial production disappointed, declining 0.1% compared to a projected 0.2% gain. The reports follow a week where inflation data was a key factor in markets. On Wednesday, the consumer price index showed a jump of 7% year over year, the highest reading in four decades. Thursday’s producer price index report reflected a rise of 9.7% over the same period. However, those results were better than some investors feared, helping markets stabilize this week.
| The text being discussed is available at | https://www.cnbc.com/2022/01/13/stock-market-futures-open-to-close-news.html and |