The stock markets in the United States declined as investors continue to monitor corporate earnings report. They are looking for signs of the strength of the bull market. The U.S. bull market hasn’t experienced a 10% correction since 2011, according to Bloomberg.
The weak performance of industrial equities led by General Electric contributed to the decline of the market today. GE dropped more than 3% to $27.60 per share.
Commenting on the market performance, Stephen Carl, a principal and head equity trader at William Capital Group told Bloomberg, “There’s a lack of economic numbers today, so investors are gearing up for earnings season. It remains to be seen if good economic numbers and positive earnings reports will fuel things in a positive vein over the short-term.”
On the other hand, Danks Bank A/S chief analyst, Allan von Mehren commented that the earnings season is “not going to look good.” According to him, the economic slowdown and stronger dollar “put pressure on profits” during the first quarter. He added, “The question now will be whether expectations have been lowered enough.”
Meanwhile, Bruce Bittles, chief investment strategist at Robert W. Baird & Co. said, “Investors are perhaps looking for something better than expected in earnings, which would certainly help the market.There’s been a pervasive lack of bears, so there’s not much selling going on. Optimism is creeping into the market now.”
Investors are also looking for signs regarding the timing of interest rate hikes. The recent minutes of the meeting of the Federal Reserve showed that policy makers are divided on the issue. Federal Reserve Chairperson Janet Yellen previously stated that interest rates will probably increase this year, and their decision depends on economic data.
Data on retail sales, industrial production and housing starts in March will be available this week.
- Dow Jones Industrial Average (DJIA) – 17,977.04 (-0.45%)
- S&P 500- 2,092.43 (+0.46%)
- NASDAQ- 4,988.25 (-0.15%)
- Russell 2000- 1,265.34 (+0.05%)
- EURO STOXX 50 Price EUR- 3,828.78 (+0.31%)
- FTSE 100 Index- 7,064.30 (-0.36%)
- Deutsche Borse AG German Stock Index DAX- 12,338.73 (-0.29%)
- Nikkei 225- 19,905.46 (-0.15%)
- Hong Kong Hang Seng Index- 28,016.34 (+2.73%)
- Shanghai Shenzhen CSI 300 Index- 4,421.07 (+1.76%)
Stocks in Focus
Incyte Corporation rallied more than 6% to $99.83 per share. The number of investors with short interest on the company’s shares declined 2.3%. Incyte is a biopharmaceutical company focused on the development and commercialization of small molecule drugs to treat serious diseases.
The stock price of Virgin America gained more than 3% to $30.32 per share due to the Airline Quality Rating (AQR) report indicating that it remained the best airline carrier in the United States.
The shares of Netflix increased more than 4% to $474.47 per share after receiving another bullish comment, this time from UBS analyst Doug Mitchelson. He upgraded his stock rating for the stock to Buy and increased his price target to $565 per share. He believed that Netflix has ability to expand overseas.