Wednesday, March 22

Wall Street opens significant falls on the Nasdaq, with Meta falling 24% and making a domino effect

Wall Street closed again yesterday in green. Specifically, the DOW JONES Ind Average ended up 0.63% at 35,629.33 points, the S&P 500 rose 0.94% at 4,589.32 and the NASDAQ 100 rose 0.80% at 15,139.74 units, in a session in which purchases and sales in the market had much to do with business results.

On the one hand, the positive figures released on Tuesday after the market closed by companies of the relevance of Alphabet (Google’s parent company) and Advance Micro Devices and, above all, the upward revision of their business expectations, helped a lot to consolidate the advances in the indices during yesterday’s session, especially the Nasdaq Composite.

However, and without leaving the subject of results, it should be noted that after yesterday’s close on Wall Street two very prominent technology companies, Meta (Facebook’s parent company) and Spotify negatively surprised investors during the presentation of their results, by showing quite pessimistic about the future of their businesses in the short term. The result was a harsh punishment for its shares in after-hours trading, with Meta down more than 20% and Spotify more than 10%.

In the case of Meta, the company reported that it had 2.91 billion monthly users during the last quarter, compared to the 2.95 billion that analysts expected. The company also gave a disappointing sales forecast for the current period, with CEO Mark Zuckerberg acknowledging that Meta faces serious competition for users’ time and attention, especially from viral video app TikTok.

Meanwhile, Spotify presented results in which it has achieved total revenue of 2,689 million euros, 24% more than in the 2020 period, with gross revenue of 712 million euros. All in all, and while Spotify’s fourth-quarter results beat Wall Street expectations, the stock was down on user prospects for the first quarter of 2022. Right now, Spotify shares open 10.5% lower.

These falls, to a large extent, drag down the Nasdaq and the S&P 500 at the opening of this Thursday both due to the relative weight of these values ​​in the indices, especially Meta, and due to the domino effect that investors think that the poor business expectations of both companies may have on the results of other companies in the technology sector.

Thus, Wall Street opens the day with important cuts. The Dow Jones fell 0.29% to 3,5524.24 points, the S&P500 lost 1.45% to 4,522.98 and the Nasdaq Composite fell 2.44% to 14,065.71 points.

Inside the Nasdaq the biggest falls are for Meta (Facebook) (24.71%) in the $243.17 and MDJM. (-18,16%).

In the S&P500, first place also goes to Meta, followed by Xylem (-7.50%) and Twitter (-5.78%).

Politics and other markets

The United States labor market contracts in January. According to data from the private consulting firm ADP, the world’s leading economy lost 301,000 jobs in the first month of the year, figures that surprised the market, since forecasts placed job creation at 207,000 new payrolls. These data contrast with the 199,000 new jobs created in December.

The United States will send about 3,000 additional troops to Poland and Romania to protect Eastern Europe from a possible spillover of the crisis due to the concentration of Russian troops near Ukrainesenior US officials said Wednesday.

According to statements by the leader of the Democratic majority of the US House of Representatives, Steny Hoyer, a vote will be taken on Friday on the Chinese Competition Law.

The oil prices they go down today At this time, Brent futures are down 0.64% at $88.90 and West Texas futures are down 0.70% at $87.64 a barrel.

Note that the OPEC has decided to maintain its plans for crude oil supply, with an increase of 400,000 barrels per day in March, despite the fact that the barrel marks record prices since 2014.

According to Oil Minister Bijan Zanganeh: “The global market needs more iranian oil supply. Iran is ready to return to the market. The sanctions imposed by the US must be removed to help oil prices and supplies.” On the other hand, Russian Deputy Prime Minister Alexander Novak stated that he will increase his oil production by 100,000 b/d in March. He also warned that “in the global oil market, many uncertainties remain, including the Omicron variant. We are seeing a recovery in the demand for petroleum products.”

According to what was said yesterday in the media, the US is in negotiations with China, Japan and India on the gas supply to Europe to guard against shortages due to tensions on the Ukrainian border

For its part, Bitcoin today experiences falls close to 4.5% at $36,653.4.

agenda of the day

In USA PMI and ISM data will be tracked, along with weekly jobless claims.

On Wall Street, today they will publish their results, among many other companies, Amazon, ConocoPhillips, Eli Lilly, Honeywell, Ford, Merck o Estee Lauder.