The bullish sentiment of Wednesday's session was nowhere to be found Thursday, as the stock market sold off heavily while the benchmark Treasury yield topped 3%.
Indexes gave back most of the prior day's big gains. The Nasdaq plunged 2.8% as techs led the selling, and the S&P 500 lost 1.9%. The Dow Jones Industrial Average fell 1.6%. Volume rose on the NYSE and Nasdaq compared with the same time on Wednesday.
The yield on the 10-year Treasury note jumped 11 basis points to 3.03%, the highest since early December 2018. The move followed Wednesday's decision by the Federal Reserve to raise interest rates a half point and start shrinking its balance sheet. Stocks rallied Wednesday after Fed chief Jerome Powell dismissed the chance of a 75-basis point hike.
The price of U.S. crude oil rose 2.6% to $110.57 a barrel.
U.S. Stock Market Today Overview |
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|---|---|---|---|---|
| Index | Symbol | Price | Gain/Loss | % Change |
| Dow Jones | (0DJIA) | 33534.30 | -526.76 | -1.55 |
| S&P 500 | (0S&P5) | 4217.57 | -82.60 | -1.92 |
| Nasdaq | (0NDQC ) | 12597.91 | -366.95 | -2.83 |
| Russell 2000 | 189.71 | -3.81 | -1.97 | |
| IBD 50 | 33.01 | -0.21 | -0.63 | |
Last Update: 10:06 AM ET 5/5/2022 |
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Silicon Motion Inks Buyout Deal
Innovator IBD 50 ETF fell 0.6%. International Money Express slid more than 5% after briefly rising above a 22.08 buy point of a base-on-base formation Wednesday on strong earnings. It is now 8% below the entry, dragging the IBD 50.
Silicon Motion was the top performer in the IBD 50 as shares soared 20%. MaxLinear agreed to acquire the company in a deal valued at about $3.8 billion. The cash and stock deal pays $114.34 per share, MaxLinear said in a press release.
The combined company will have strong positions in the broadband, connectivity, infrastructure and storage end markets, the companies said. Combined revenues will exceed $2 billion a year. The deal is expected to close in the first half of 2023. MaxLinear stock plunged 16%. Silicon Motion topped a 96.99 buy point, although many buyout stocks tend to flatten out once a deal is in place.
Wesco International climbed above the 141.02 buy point of an uneven pattern in heavy volume. The supplier of electrical, electronic, communications, security solutions and broadband products beat first-quarter views and raised its 2022 profit guidance. Keep in mind, the market remains in a correction, and all stock buys are extra risky.
Dow Dives As Yields Soar In Delayed Fed Reaction
Fortinet, Shopify, Etsy Among Stock Market Movers
Fortinet pared gains to 1.7%, as it tried to build on a positive reversal Wednesday. The stock is forming an undefined base and remains below its 50-day and 200-day moving averages. Late Wednesday, the cybersecurity company reported earnings and revenue that topped estimates.
Shopify plunged after first-quarter earnings, revenue and gross merchandise volume missed analyst estimates. The company also announced the acquisition of fulfillment operator Deliverr for $2.1 billion. Shares tumbled more than 16%.
CF Industries rose modestly and continues to find support at the 10-week moving average. The fertilizer supplier late Wednesday posted mixed first-quarter results. Earnings missed estimates, but sales beat views. Higher natural gas feedstock costs likely contributed to the EPS miss, though it was still a 500% increase from a year ago.
Etsy sold off nearly 15% in heavy trading, wiping out three days of gains, on a disappointing outlook. Morgan Stanley cut its price target on the crafts marketplace to 113 from 154 and maintained an equal-weight rating.
Musk Wins More Funding For Twitter Deal
Tesla CEO Elon Musk strengthened his bid to acquire Twitter by securing financial commitments for about $7.14 billion from 19 investors. The biggest is Prince al-Waleed bin Talal of Saudi Arabia. Twitter shares jumped nearly 4%, rising above the 200-day line and breaking a quiet stretch in the stock.
Claims for jobless benefits climbed to 200,000 last week, from 181,000 the previous week. It was a higher number of claims than the 178,000 economists expected, according to Econoday.
