The stock market fell deeper on Friday as mixed earnings reports were not enough to boost the market. Consumer discretionary and technology stocks joined retailers in the downward trend. Farm equipment maker Deere fell sharply in spite of beating the consensus quarterly earnings forecast.
In mid-afternoon trade, the Nasdaq composite lost 2.4%. The S&P 500 dropped 1.7%. The Dow Jones Industrial Average was down 1.5%. The S&P 500 and Nasdaq are on course for their seventh straight weekly loss, while the Dow Jones index is on track for its eighth straight losing week after it undercut last week's lows. The S&P 500 and Dow are both on track to finish the week down more than 4%. So far, Nasdaq is down 6% on the week.
The small-cap Russell 2000 index fell 1.9%.
Volume fell on the Nasdaq and NYSE compared with the same time on Thursday.
U.S. Stock Market Today Overview |
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|---|---|---|---|---|
| Index | Symbol | Price | Gain/Loss | % Change |
| Dow Jones | (0DJIA) | 30791.69 | -461.44 | -1.48 |
| S&P 500 | (0S&P5) | 3833.95 | -66.84 | -1.71 |
| Nasdaq | (0NDQC ) | 11119.44 | -269.06 | -2.36 |
| Russell 2000 | 173.15 | -3.38 | -1.91 | |
| IBD 50 | 29.41 | -0.74 | -2.45 | |
Last Update: 1:42 PM ET 5/20/2022 |
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Deere reported better-than-expected Q1 earnings Friday morning, while raising full-year profit guidance. But Deere stock plunged 14% anyway.
Deere Beats Earnings Views, Stock Falls Anyway
Deere reported a profit of $6.81 a share, compared with $5.68 a share a year earlier. FactSet analysts on consensus expected earnings of $6.75 a share. Sales rose 11% to $13.37 billion. Analysts were looking for $13.23 billion.
"Looking ahead, we believe demand for farm equipment will continue benefiting from positive fundamentals in spite of availability concerns and inflationary pressures affecting our customers' input costs," Deere CEO John May said in a news release.
A month ago DE stock was at record highs, with many farm-related stocks and groups doing well. But farm equipment companies have faced supply-chain issues, and inflation has weighed on consumers and farmers.
Chip stock Applied Materials reported earnings late Thursday. The firm missed on EPS and sales and gave weak guidance for the current quarter due to supply chain issues.
The stock lost more than 7% on Friday and remains in a long downtrend.
Palo Alto Networks gapped up early more than 12% but then retreated to a gain of 7%.
The firm beat fiscal Q3 estimates for earnings. The cybersecurity firm said profit rose 30% to $1.79 per share on an adjusted basis. Including acquisitions, revenue rose 29% to $1.4 billion. Analysts expected earnings of $1.68 per share on sales of $1.36 billion.
Ross Stores was the latest among retailers to report weak earnings this week. The company missed expectations across the board while giving weaker targets for the current quarter. Shares plummeted over 22% in heavy volume.
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Consumer Discretionary, Technology Stocks Add To A Sagging Stock Market
Kohl's plunged 13% in a belated response to Thursday's earnings report, which missed analysts' forecasts. Costco, which is due to report earnings next week, also gave up 3%.
The Consumer Staples Select Sector SDPR ETF lost 0.8%, bringing its weekly losses to 9%.
But the Consumer Discretionary Sector SPDR suffered the biggest losses on Friday, down 3.8%. Tesla dropped more than 9%.
The price of U.S. crude oil was virtually unchanged at $112 a barrel.
The yield on the 10-year Treasury note at one point fell 7 basis points to 2.77%, according to Cboe data. The fall in Treasury yields came after China's central bank said it was cutting a key interest rate as growth tumbled.
The Innovator IBD 50 ETF fell 2.3%, driven down by oil, industrials and materials stocks.
Follow Michael Molinski on Twitter @IMmolinski
