Dow slips as earnings fall short of expectations by Investing.com

By Yasin Ebrahim

Investing.com – The Dow Jones fell on Wednesday as a sea of ​​red swept Wall Street on essentially weaker quarterly earnings, while an unchanged Fed decision did not change the direction of the market.

The decrease of 1.30%, or 403 points. The was down 1.59%, while the decline of 1.13%.

The Federal Open Market Committee kept its benchmark rate in a range of 0% to 0.25% and maintained its monthly pace of bond purchases of $ 120 billion. The central bank reaffirmed that the trajectory of the economy “will depend significantly on the evolution of the virus, including progress in vaccination”, while acknowledging that “the ongoing public health crisis continues to weigh on the economic activity”.

The major component of Dow Boeing (NYSE 🙂 fell 4% after a larger-than-expected quarterly loss of $ 15.25 per share. The loss was largely due to an $ 8.3 billion hit related to the ground of the 737 Max and a delay in the 777-X program.

Starbucks (NASDAQ 🙂 fell more than 6%, as the coffeehouse chain said U.S. same-store sales fell 5% in its first fiscal quarter due to the impact of new restrictions aimed at curbing the spread of the virus.

Chipmakers were also under pressure, down more than 2%, boosted by weakness in Advanced Micro Devices (NASDAQ :), despite better-than-expected earnings of 52 cents per share.

Microsoft (NASDAQ :), however, resisted the trend, rising more than 1% after reporting earnings of $ 2.04 per share that significantly exceeded analyst estimates thanks to growth in its Azure cloud business.

The large number of profits precede quarterly reports from Apple (NASDAQ :), Facebook (NASDAQ 🙂 and Tesla (NASDAQ 🙂 due after market close on Wednesday.

In Tesla’s report, analysts identified advice on deliveries as critical to further support electric vehicle growth.

“A positive guide to 2021 deliveries, combined with comments that will reinforce the growth narrative, could serve as a positive catalyst for action, even despite its strong valuation,” Swiss credit (SIX 🙂 said in a note.

Energy was the only sector in the green as oil prices turned positive with data showing weekly inventories dropped unexpectedly.

Investor attention has also been captured by an ongoing short-squeeze on Wall Street, led by a cohort of mostly retail traders, clustering on the Reddit forums, who appear to be bidding on short-interest stocks above the float.

GameStop (NYSE 🙂 sellers Melvin Capital and Citron Research were forced to close positions in the video game retailer’s shares with huge losses following a rally of more than 700% of the stock. .

AMC Entertainment (NYSE 🙂 short sellers were also caught in the pressure as the stock rose more than 200%