Stocks tumbled, with Nasdaq index futures losing about 1%, as investors punished companies reporting weaker-than-expected earnings.
Meta Inc. sank 4% in US pre-market trading after saying it’s at the whim of an uncertain economic environment. Google’s parent Alphabet Inc. lost 2.3%, extending a selloff on Wednesday on disappointing cloud figures. Amazon.com Inc., which reports results after the bell, slid 1.5%.
The bearish mood carried over to other markets, with European and Asian equities also recording steep losses. The greenback strengthened and gold added 0.5%. The yen slumped back past 150 per dollar again, fueling speculation about government intervention in the currency market.
Traders are “opting to sell first in fear that sentiment will get worse before it gets better,” said Paul de La Baume, an investment advisor at BNP Paribas Suisse SA.
Earnings missteps at big US tech companies causing ructions in equity markets are investors rethink sky-high valuations against a backdrop of rising Treasury yields. While the Nasdaq 100 has been seemingly immune to pessimism, with the index still up 31% this year, there’s now growing concern about its vulnerability in a wider stock market selloff.
On the economic front, US initial jobless claims and GDP numbers are part of a flurry of data later Thursday. A policy decision is also due from the European Central Bank, which is expected to keep interest rates on hold for the first time in more than a year.
Corporate Highlights:
- Unilever Plc fell 2.7%. The proportion of businesses that are gaining market share reached 38%, the lowest ever, as shoppers stray to rival products to save money. Third-quarter sales growth was just shy of estimates.
- WPP Plc dropped 3%. The advertising giant slashed its outlook for revenue growth after reporting sluggish sales, blaming shrinking spending from the technology industry and China’s weak economy.
- Mercedes-Benz Group AG declined 6%. The carmaker reported a drop in third-quarter margins from a year ago after average car prices declined and inflation fanned the cost of everything from components to labor.
- Standard Chartered Plc plunged 12% after it said profit missed estimates in the third quarter as it took charges related to investments in China.
Key events this week:
- European Central Bank interest rate decision; President Christine Lagarde holds news conference, Thursday
- US wholesale inventories, GDP, US durable goods, initial jobless claims, pending home sales, Thursday
- Intel, Amazon earnings, Thursday
- China industrial profits, Friday
- Japan Tokyo CPI, Friday
- US PCE deflator, personal spending and income, University of Michigan consumer sentiment, Friday
- Exxon Mobil earnings, Friday
Some of the main moves in markets:
Stocks
- The Stoxx Europe 600 fell 0.9% as of 10:07 a.m. London time
- S&P 500 futures fell 0.6%
- Nasdaq 100 futures fell 0.9%
- Futures on the Dow Jones Industrial Average fell 0.4%
- The MSCI Asia Pacific Index fell 1.4%
- The MSCI Emerging Markets Index fell 1.2%
Currencies
- The Bloomberg Dollar Spot Index rose 0.2%
- The euro fell 0.2% to $1.0543
- The Japanese yen fell 0.1% to 150.40 per dollar
- The offshore yuan was little changed at 7.3292 per dollar
- The British pound fell 0.3% to $1.2080
Cryptocurrencies
- Bitcoin fell 0.3% to $34,578.1
- Ether rose 3.8% to $1,855.02
Bonds
- The yield on 10-year Treasuries was little changed at 4.95%
- Germany’s 10-year yield was little changed at 2.89%
- Britain’s 10-year yield was little changed at 4.61%
Commodities
- Brent crude fell 0.6% to $89.62 a barrel
- Spot gold rose 0.6% to $1,991.56 an ounce
This story was produced with the assistance of Bloomberg Automation.
--With assistance from Matthew Burgess, Chiranjivi Chakraborty and John Viljoen.
