In this photo provided by the New York Stock Exchange, trader Colby Nelson works on the trading floor, Monday, Feb. 7, 2022. Several big companies are on deck this week to report their results, including Pfizer on Tuesday and Walt Disney on Wednesday. Twitter and Coca-Cola will report on Thursday. (Allie Joseph/New York Stock Exchange via AP)
By Damian J. Troise and Alex Veiga
Another wobbly day on Wall Street ended Monday with an uneven finish for the major stock indexes as losses by communication and technology companies kept gains elsewhere in the market in check.
The S&P 500 fell 0.4%, giving back some of its recent gains. The Dow Jones Industrial Average was little changed after wavering between a gain of 0.7% and a loss of 0.3%. The tech-heavy Nasdaq composite fell 0.6%.
The uncertain trading follows weeks of volatility for major indexes as traders try to figure out how stock valuations will be affected by the interest rate hikes looming on the horizon as the Federal Reserves moves to tame inflation.
Wall Street is coming off of two weeks of gains following a January stumble that served partially as a “pressure relief valve,” said Mark Hackett, chief of investment research at Nationwide.
“Some of the emotion that we’ve been dealing with in the first several weeks of the year has started to ease,” he said. “You almost needed that; the expectations had been so high.”
The S&P 500 slipped 16.66 points to 4,483.87. The benchmark index is now 6.5% below the all-time high it set on Jan. 3.
The Dow was essentially flat after inching up 1.39 points to 35,091.13.. The Nasdaq fell 82.34 points to 14,015.67.
Small-company stocks outpaced the broader market. The Russell 2000 rose 10.24 points, or 0.5%, to 2,012.60.
Communication and technology companies were the biggest drag on the S&P 500. Facebook’s parent, Meta, fell 5.1% and Google’s parent company Alphabet fell 2.9%. Microsoft fell 1.6%.
Energy and financial companies made solid gains. Chevron rose 2% and insurer Allstate rose 2.2%.
Travel-related companies also gained ground. Carnival rose 7.8%, Royal Caribbean gained 8.4% and American Airlines added 5%.
Treasury yields were broadly lower. The yield on the 10-year Treasury slipped to 1.92% from 1.93% late Friday.
Investors are still gauging the impact of rising inflation on businesses and consumers while remaining cautious about the Federal Reserve’s plan to fight inflation. Wall Street will get another key update on inflation Thursday with the Labor Department’s report on consumer prices for January.
The Fed plans to raise interest rates to fight inflation. Investors expect the first hikes in March and are wary about the pace and quantity of rate increases in 2022.
Investors have another busy week reviewing the latest corporate report cards. Meat producer Tyson Foods rose 12.2% after reporting strong results.
Several big companies are on deck this week to report their results, including Pfizer on Tuesday and Walt Disney on Wednesday. Twitter and Coca-Cola will report on Thursday.
Outside of earnings, several companies gained ground on buyout news Monday. Spirit Airlines jumped 17.2% after Frontier Airlines’ parent company agreed to buy the carrier in a deal worth $2.9 billion.
Peloton rose 20.9% following reports that the exercise bike and treadmill company is a buyout target for companies including Nike and Amazon. The company has been on a roller-coaster ride since the pandemic began. Its stock surged more than 400% in 2020 as COVID-19 forced lockdowns and shifted the workout trend from the gym to home. It spend 2021 giving back nearly all of those gains as businesses reopened and people started heading back to gyms.
Shares have been choppy this year for Peloton, especially following reports in January that its was temporarily halting production of its connected fitness products amid waning consumer demand. Activist investor Blackwells Capital asked the company to remove CEO John Foley and consider selling the company just a few days after those reports.
A rare magnum of Dom Pérignon Vintage 1961 champagne that was specially produced for the 1981 wedding of Prince Charles and Lady Diana has failed to sell during an auction. Danish auction house Bruun Rasmussen handled the bidding Thursday. The auction's house website lists the bottle as not sold. It was expected to fetch up to around $93,000. It is one of 12 bottles made to celebrate the royal wedding. Little was revealed about the seller. The auction house says the bids did not receive the desired minimum price.
The New York Times and President Donald Trump are fighting again. The news outlet said Wednesday it won't be deterred by Trump's “false and inflammatory language” from writing about the 79-year-old president's health. The Times has done a handful of stories on that topic recently, including an opinion column that said Trump is “starting to give President Joe Biden vibes.” In a Truth Social post, Trump said it might be treasonous for outlets like the Times to do “FAKE” reports about his health and "we should do something about it.” The Republican president already has a pending lawsuit against the newspaper for its past reports on his finances.
OpenAI has appointed Slack CEO Denise Dresser as its first chief of revenue. Dresser will oversee global revenue strategy and help businesses integrate AI into daily operations. OpenAI CEO Sam Altman recently emphasized improving ChatGPT, which now has over 800 million weekly users. Despite its success, OpenAI faces competition from companies like Google and concerns about profitability. The company earns money from premium ChatGPT subscriptions but hasn't ventured into advertising. Altman had recently announced delays in developing new products like AI agents and a personal assistant.
President Donald Trump says he will allow Nvidia to sell its H200 computer chip used in the development of artificial intelligence to “approved customers” in China. Trump said Monday on his social media site that he had informed China’s leader Xi Jinping and “President Xi responded positively!” There had been concerns about allowing advanced computer chips into China as it could help them to compete against the U.S. in building out AI capabilities. But there has also been a desire to develop the AI ecosystem with American companies such as chipmaker Nvidia.
U.S. sports betting is booming as NFL and college football fuel massive activity. BetMGM CEO Adam Greenblatt breaks down trends, growth, and what’s next.
President Donald Trump says a deal struck by Netflix last week to buy Warner Bros. Discovery “could be a problem” because of the size of the combined market share. The Republican president says he will be involved in the decision about whether federal regulators should approve the deal. Trump commented Sunday when he was asked about the deal as he walked the red carpet at the Kennedy Center Honors. The $72 billion deal would bring together two of the biggest players in television and film and potentially reshape the entertainment industry.
Disney's changes to a program for disabled visitors are facing challenges in federal court and through a shareholder proposal. The Disability Access Service program, which allows disabled visitors to skip long lines, was overhauled last year. Disney now mostly limits the program to those with developmental disabilities like autism who have difficulty waiting in lines. The changes have sparked criticism from some disability advocates. A shareholder proposal submitted by disability advocates calls for an independent review of Disney's disability policies. Disney plans to block this proposal, claiming it's misleading. It's the latest struggle by Disney to accommodate disabled visitors while stopping past abuses by some theme park guests.
