S&P 500, Nasdaq Plummet Today | Beyond the Bell

And right now we are two minutes away from the end of the trading day. Romaine Bostic alongside Alex Steele. We’re counting you down to the closing bell and here to help take us beyond the bell. It’s a global simulcast Scarlett Foo in Studio 2, Carol Massar and Tim Senevic in the radio cage. We welcome our audiences across all of our Bloomberg platforms, including our partnership with YouTube on what’s setting up right now. Carol Massar ought to be the broadest based sell off that we’ve had all year, though on a percentage basis. Not quite the worst. Yeah, check it out too. Just met in the studio or the cage as you like to call it, Romaine earlier today and say the S&P 500 on pace for its worst week in 2024 and its worst week since October 27th of 2023. If that date sounds familiar, it should because that was the bottoming or recent bottoming if you will, of the S&P 500 and what began a 27% climb in the S&P 500. So we’re all a little bit on edge here as we watch what’s going on in the Middle East. Yeah. It hasn’t been a great week, but I will remind people that we are still up more than 7 .3% on the S&P 500 so far this year. We’re only down about 2.6% from all time highs reached at the end of last month. Still, geopolitical concerns, do you have certainly have investors on edge. Yeah, those geopolitical concerns are really hitting EIS, which is the ETF that tracks Israel down for a fourth straight day, losing 2.8% right now. And we’re also seeing weakening in the Israeli shekel as well when everyone’s just kind of on tenterhooks waiting for the headlines. Yeah. And you can really see that reflected in gold earlier, right? You had that move to 2400 and then we had sort of a sell off, which I mean that’s the point of gold. You buy it when you’re scared and then you also sell it when things get bad. So you can make the argument it’s doing its job. So still part of that safe haven narrative from it. A couple days ago, it looked like the major equity indices here in the US we’re headed for a weekly gain. But based on where we stand right now, we’re setting up here for weekly losses across the board. All right, we got the closing bells here in New York. The Dow Jones Industrial Average is going to finish out the day down by almost about 475 points. It takes a while for these numbers to settle, but nevertheless the damage is done. Down a percent here on the day, 2 1/2 percent on the week, the S&P is going to finish lower by about 76 points, or 1 1/2 percent on the week and on the day as well by the NASDAQ composite, down about 1.6% here on the day and about a half a percent on the week. But keep an eye on the Russell. At one point it did trade below its 2000 and level a key line in the sand for a lot of technical traders out there is going to close slightly above that the 2003 and change down about 39 points or 1.9%. All right, Romaine, you said it well risk off trade certainly on this Friday session, if I look at the S&P 500 folks, most of the names in the index trading lower today scarlet 460 to be exact. We’ll get into the sectors in just a moment, 41, getting some ground to unchanged. Yeah, if you look at the sectors, it’s pretty much red across the board. There are there’s one pocket of green in that one be in real estate management, but the main 11 sectors are all down. The worst performance here are materials, tech and consumer discretionary, each off by at least 1 1/2%. All right, I’m going to say it wasn’t easy to find gainers, but I got a little assist from my partner in crime here, Tim. So among them, first of all an IPO. Go figure, maybe not a day that you want to begin trading, but nonetheless, UL solutions ticker ULS did just that. And coming out of the gate and pretty much holding on to its gains here in its first day of trading up 25% here. This is a safety testing and inspection company. It did expand its IPO. It raised $946,000,000. The pricing though within the market of range, but nonetheless out of the gate really strong in a day where as we just talked about pretty much so many sectors, almost everything was down here. Also Globe Life, Tim talked about this yesterday. It got hammered down 53% in the Thursday trade, a record decline. There a different trade today it was up about 20% after that sell off yesterday we know the news, it was a short seller, an anonymous short seller. Fuzzy Panda Research released a report against Global Life but nonetheless investors coming back into that name today. Speaking of insurance, Allstate also a gainer in today’s trade, just up up 2% at its highs today, finishing the day with about a 7/10, 710th of 1% gain. Not sure why, but there were some analyst calls yesterday, Evercore, also Wells Fargo raising their price targets on this company. So a little bit of a move to the upside and one more name coup paying. It’s a $38 billion market cap. e-commerce company, Korean e-commerce company. And it came out saying that it’s going to raise the monthly fee for its WOW membership for new clients starting on Saturday. And so you saw that one really outperforming today’s session up 11%. OK, let’s talk about some underperformance here because no shortage of stocks to choose from. I do want to start with JP Morgan having its worst day going all the way back to June of 2022, closing down 6.5%. This after the company reported that net interest income slightly missed analyst estimates, a sign that the benefit of higher rates may be waning amid pressure to pay out more to depositors. We should note that going into the report, shares were up nearly 15%, shares up just a little over around 8% so far this year. Now after this decline, hey, do you want to check on shares of chip stocks? Because we did see both Intel and AMD as well as NVIDIA move lower. Today. Intel felt more than 5%. AMD for its part fell 4.2%. This after the Wall Street Journal reported that China has has asked its telecom carriers to start phasing out foreign chips. The direction went to China’s largest telecom carriers earlier this year to phase out foreign processors that are core to their networks by 2027. This according to the Wall Street Journal, who cited people familiar with the matter. And then finally, let’s take a look at how Boeing ended up doing today after what I think it’s fair to say a pretty rough week for the company. What’s that? No, never mind. No, 2.2% down today, down more than 7% so far this year or so far this week I should say. Having their worst run guys going all the way back to 20/19/2018, excuse me, back when it’s 737 Max aircraft was involved in a deadly crash off Indonesia shares down about 60% from all time highs that were reached back in 2019. That is a brutal stat. I’m taking a look at the bond market here. We know there’s been a safe haven, a safe haven move into that. The 10 year yield for example is down 7 basis points, A7 year down 8, but I have to say yields were down more earlier in the session. Also, considering that big move that we got on the front end earlier this week, we’re up at 22 basis points in one session, this doesn’t feel like a huge reaction that we could have had reversing some of the earlier selling guys. Yeah, I think that’s a really good point. And if I go back to even the equity trade today to see that we kind of bounced off our lows and saw a little bit of buying into the clothes. I thought that was kind of interesting. Yeah, go ahead. Well, just a counterpoint to that though, too. I mean, I think one thing that alarmed me was just how much in lockstep we saw some of those safe haven trades trade if you will, the idea that you had the VIX elevated oil prices elevated, the dollar elevated. I mean usually when you have the dollar go and wonder go up and then you get oiled maybe going the other direction and then you play that in with the drop that we saw in yields. And and then I got that brief embrace of gold. I don’t know, I mean I feel like this is a little bit different than maybe some of the last, the last big sell off that we had. Yeah, we did speak to Hagar Shamali earlier in our program and and she said that, look, I’m not an alarmist here. She spent years working at the State Department. She said, I’m not an alarmist, but I am very concerned right now. All that said, guys, we could go the weekend and not see anything happen. Can I say I actually listened to that interview? First of all, it was a great interview, Tim. And and then I’m glad you pushed back because I, I actually found it alarmist. I mean, I mean her tone and I know that you know the tone that you’re going to get from someone like that versus say an actual investor who maybe has a little bit more of a buffer is going to be different. But I did think that what she said about just the potential that this could be bigger I guess than than maybe some of the previous incidents. Yeah. I think escalation is certainly a concern. I mean look what what’s the, what could the US do in response? And and that’s that’s what she said, you know, she’s essentially said, OK well we could see warships ending up you know, being deployed as a result of of some sort of attack. But I think the, you know, a lot of people want to avoid getting into something that could be considered, you know, a a widespread conflict. She also though did also say that Iran knows its limitations and and how much it can kind of push the United States. So they’re going to be maybe thoughtful in terms of what kind of retaliation they do. So we’ll see what happens this weekend. I mean going back to kind of our bread and butter in terms of the markets, folks are saying we had Bill Maloney and JJ Kenahan in here and said again if nothing happens, you could see investors certainly come back into the market. So we will certainly wait and see what what ultimately happens and whether or not we get escalation to another level. Yeah. So I was saying like do if we don’t see anything, do we get the buy the dip kind of scenario for that? Can we pivot here? Is that, is that OK, can we talk bagels out some other stuff? I’m going to, I’m going to move to some of the interesting stories that maybe didn’t move markets but are quite interesting and will impact how you maybe live your life. And that’s McDonald’s. So apparently guys, you know this that because California raised the minimum wage, McDonald’s wants to get more people in the stores. So they’re bringing back bagels to help them do that. Yeah, they’re doing that. Well, they’re dealing with this, what, mandatory 25% bump in pay. So they’re trying to figure out, OK, we’ve got to figure out how do we pay for this. And apparently, although Tim and I are kind of scratching our heads, bagels were a really popular thing at McDonald’s, which makes me wonder, OK, who told them to take them away, first of all, if it brings traffic in. But nonetheless, because they know this, they did a focus group, They’re going to kind of reintroduce them and they’re actually doing some marketing, which is what they don’t know on a local scale. Yeah, local marketing just in California spending $15 million there, which could be significant. I think a couple things to keep in mind here. One is it can end up costing a lot of money for these franchisees to pay these wages, these higher wages, $250,000 per restaurant with That’s a lot of money. But everywhere is going to have to raise wages. So all prices are going to go up. Every every restaurant is dealing with this. All I have to say is bagels in California don’t usually work out. Well, that’s all. Here we go. We talked about this. She would be right. Bagels in New York. No, it’s the water. The water. The water. Oh, come on. You’re probably a pizza snob too. Of course. Yes, yes. All right. On that note, that’s a wrap guys have a good and safe weekend that’s going to do it for a cross-platform, radio, TV, YouTube, Bloomberg Originals, we call it Beyond the Bell. We will see you same time, same place on Monday.