Stocks finished lower Thursday, while Treasury bond yields and the dollar consolidated recent gains as investors look to ride a better set of first-quarter earnings and baked-in Federal Reserve rate risks.
The Dow Jones Industrial Average ended down 368 points, or 1.05%, at 34,792, while the S&P 500 fell 1.5%. The tech-focused Nasdaq fell 2.1% as 2-year yields hit 2.686%.
A weaker session overnight in China, however, as well as another leg higher in oil prices weighed on markets. China's "zero Covid" policy is set to hit second-quarter GDP and cause further disruptions to global supply chains, according to IMF Managing Director Kristalina Georgieva.
The EU's potential ban on Russia crude exports is also lifting global oil prices, as is the bigger-than-expected decline in U.S. domestic crude stocks reported Wednesday by the Energy Department, even as traders discount near-term China demand.
WTI crude futures for June delivery were up $1.53 to $103.70 per barrel, while Brent contracts for the same month added $1.47 to trade at $108.30 per barrel.
Benchmark Treasury 10-year note yields up to 2.892% in New York trading after briefly testing the 3% mark for the first time since 2019 in the overnight session.
The dollar index, which tracks the greenback against a basket of its global peers, was marked 0.2% higher at 100.59 in New York trading.
Federal Reserve Chairman Jerome Powell signaled a 50-basis point rate hike is likely at the Fed's May meeting in comments at the IMF's springs meetings today in Washington.
In Europe, the region-wide Stoxx 600 added another 0.48% to yesterday's earnings-driven gains, with bluechips Nestle and ABB posting stronger-than-expected first quarter updates and French President Emanuel Macron appearing to win a televised debate with his rival, the far-right Marine Le Pen, ahead of this weekend's second round elections.
Overnight in Asia, China stocks fell for a third consecutive session, pulling the region-wide MSCI ex-Japan index 0.33% lower into the close of trading,
Tesla (TSLA) shares rose 3.23% after the carmaker posted stronger-than-expected first quarter profits, record sales and bullish near-term outlook that defied Wall Street's forecasts and powered-through surging input prices and supply chain chaos.
CEO Elon Musk indicated there was a "reasonable shot" for 2022 deliveries to rise 60% from last year, noting the ramp-up of production facilities in Berlin and Austin, following a surprisingly solid first quarter that saw automotive profit margins rise to 30%, record sales of $18.76 billion and a stronger-than-expected bottom line of $3.22 per share.
Twitter (TWTR) shares were marginally higher after Musk said he is still interested in negotiating a purchase of the social media group but hasn't yet determined if he'll take his now $46.5 billion offer directly to shareholders.
United Airlines (UAL) soared shares soared 9.1% after the carrier forecast record second quarter revenues amid what CEO Scott Kirby called the strongest domestic travel boom in more than three decades.
American Airline (AAL) gained 3.8% after a narrower-than-expected first quarter loss and followed United in predicting record near-term revenues and return to profitability.
AT&T Inc. (T) gained 4% after posting stronger-than-expected first-quarter earnings in its maiden investor update following the spin-off of its media assets into Warner Bros. Discovery (WBD), with revenues topping forecast thanks to solid gains for its wireless and broadband divisions.
Netflix (NFLX) shares, meanwhile, extended their two-day slump, falling 3.5% following the stock's biggest single-day decline in early two decades, after billionaire investor Bill Ackman dumped his short-lived stake in the online streaming group.
