U.S. stocks closed lower on Monday after bank stocks erased earlier gains and concerns over a slowing economy made investors jittery once again. All the three major indexes ended in positive territory.
How Did The Benchmarks Perform?
The Dow Jones Industrial Average (DJI) gave up 0.7% or 215.65 points to finish at 31,072.61 points. The blue-chip index was at one rose as much as 356 points, only to give up all its gains and record its largest single-day percentage and point decline since Jun 30.
The S&P 500 fell 0.8% or 32.31 points to end at 3,830.85 points. Healthcare, utilities, tech and consumer staple stocks were the worst performers.
The Utilities Select Sector SPDR (XLU) lost 1.4%, while the Health Care Select Sector SPDR (XLV) declined 2.1%. The Technology Select Sector SPDR (XLU), Consumer Staples Select Sector SPDR (XLP) and Real Estate Select Sector SPDR (XLRE) each declined 1%. Eight the 11 sectors of the benchmark index ended in negative territory.
The tech-heavy Nasdaq shed 0.8% or 92.37 points to close at 11,360.05 points, snapping its two-day winning streak.
The fear-gauge CBOE Volatility Index (VIX) was up 4.42% to 25.30. Advancers outnumbered decliners on the NYSE by a 1.20-to-1 ratio. On Nasdaq, a 1.06-to-1 ratio favored declining issues. A total of 10.63 billion shares were traded on Monday, lower than the last 20-session average of 12.15 billion.
Report on Apple Leads to Selloff
Stocks finished last week on a high and tried to hold on to the momentum as they began a fresh week. Trading started on a positive note as investors were upbeat after a fresh batch of earnings from some big banks gave their confidence a boost.
However, things took a turn almost in the latter part of the day after a Bloomberg report said that Apple, Inc.
AAPL
was planning to slow hiring and spending growth next year anticipating an economic downturn. This once again ignited fears of a recession in the minds of investors, leading to a massive selloff. Apple’s shares ended down 2.1%. Apple has a Zacks Rank #3 (Hold). You can see
the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here
.
Earlier in the day, stocks rallied as investors focused more on the positive elements of the quarterly reports from The Goldman Sachs Group, Inc.
GS
and Bank of America Corporation
BAC
. Goldman Sachs reported second-quarter 2022 earnings of $7.73 per share, surpassing the Zacks Consensus Estimate of $6.99 per share.
Bank of America, however, reported second-quarter earnings of $0.73 per share, missing the Zacks Consensus Estimate of $0.77 per share.
Quarterly reports from other big banks like both JPMorgan Chase & Co.
JPM
and Morgan Stanley
MS
initially didn’t impress investors last week. However, they now look a lot confident after some of the other major banks delivered solid profits. Investors are now focusing on the positive elements of the quarterly reports. The earnings season is underway and will be in full swing in the next couple of weeks.
In spite of all these positives, the report on Apple played a major role in Monday’s trading toward the end of the session that saw all the three major indexes giving up all their gains to end in negative territory.
No economic data was released on Monday.
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