S&P 500 closes the book on its steepest first-half slide since 1970

NEW YORK, June 30 (Reuters) – Wall Road ended decrease on Thursday, crossing the end line of a grim month and quarter, a dismal coda to the S&P 500’s worst first half in additional than half a century.

All three main U.S. inventory indexes completed the month and the second quarter in adverse territory, with the S&P 500 notching its steepest first-half proportion drop since 1970.

The Nasdaq had its largest-ever January-June proportion drop, whereas the Dow suffered its greatest first-half proportion plunge since 1962.

All three indexes posted their second straight quarterly declines. The final time that occurred was in 2015 for the S&P and the Dow, and 2016 for the Nasdaq.

The yr started with spiking instances of COVID-19 because of the Omicron variant. Then got here Russia’s invasion of Ukraine, decades-high inflation and aggressive rate of interest hikes from the Federal Reserve, which have stoked fears of a potential recession. learn extra

“All yr it’s been a tug-of-war between inflation and slowing development, balancing tightening monetary situations to deal with inflation considerations however attempting to keep away from outright panic,” mentioned Paul Kim, chief government officer at Simplify ETFs in New York. “I feel we’re greater than probably already in a recession and proper now the one query is how harsh will the recession be?”

“I feel it’s impossible that we’ll see a comfortable touchdown,” Kim added.

Financial knowledge launched on Thursday did little to allay these fears. Disposable revenue inched decrease, shopper spending decelerated, inflation remained sizzling and jobless claims inched larger. learn extra

“We’ve began to see a slowdown in shopper spending,” Stated Oliver Pursche, senior vice chairman at Wealthspire Advisors, in New York. “And evidently inflation is taking its toll on the typical shopper and that interprets to company earnings which is what in the end drives the inventory market.”

The graphic beneath reveals year-on-year development of core inflation indicators, all of which counsel that whereas a peak seems to have been reached in March, all of them proceed to soar effectively above the Fed’s common annual 2% goal:

The Dow Jones Industrial Common (.DJI) fell 253.88 factors, or 0.82%, to 30,775.43, the S&P 500 (.SPX) misplaced 33.45 factors, or 0.88%, to three,785.38 and the Nasdaq Composite (.IXIC) dropped 149.16 factors, or 1.33%, to 11,028.74.

Eight of the 11 main S&P sectors ended down, with utilities (.SPLRCU) main the gainers and vitality (.SPNY) notching the most important proportion drop.

However vitality was to solely main sector to submit a year-to-date achieve, aided by crude costs spiking over provide considerations attributable to Russia-Ukraine battle.

The foremost inventory indexes misplaced floor in June, with the S&P 500 logging its largest June proportion decline because the monetary disaster.

Second-quarter reporting season begins in a number of weeks, and 130 of the businesses within the S&P 500 have pre-announced. Of these, 45 have been optimistic and 77 have been adverse, leading to a adverse/optimistic ratio of 1.7 stronger than the primary quarter however weaker than a yr in the past, in line with Refinitiv knowledge.

Worries over inflation dampening shopper demand and threatening revenue margins may have market individuals listening intently to ahead steering.

Walgreens Boots Alliance Inc (WBA.O) fell 7.3% as its quarterly revenue plunged 76%, damage by its opioid settlement with Florida and a lower in U.S. pharmacy gross sales on waning demand for COVID-19 vaccinations. learn extra

Declining points outnumbered advancing ones on the NYSE by a 1.75-to-1 ratio; on Nasdaq, a 1.52-to-1 ratio favored decliners.

The S&P 500 posted one new 52-week excessive and 42 new lows; the Nasdaq Composite recorded 17 new highs and 367 new lows.

Quantity on U.S. exchanges was 12.58 billion shares, in contrast with the 12.86 billion common during the last 20 buying and selling days.

Reporting by Stephen Culp; Extra reporting by Shreyashi Sanyal and Amruta Khandekar in Bengaluru; Modifying by David Gregorio

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