Posted at 10:17, ET on March 22, 2019 |
After 19 years of hedging the US stock market today, Adam Shell gives his best advice for successfully investing in the market.
UNITED STATES TODAY & # 39; HUI
NEW YORK (AP) – Stocks slide on Wall Street on Friday and bond yields are down sharply, as investors fear a slowdown in global economic growth.
Banks and technology companies led the decline, which offset market gains for the week.
Citigroup led the fall of banks with a loss of 4.9%, while bond yields continued to fall, jeopardizing the profitability of profitable financial companies through loans.
Large technology firms, which may lose more than other sectors in a slowing economy, have fallen more than the rest of the market. Hewlett-Packard fell by 3% and Intel by 2%.
Boeing dropped 2.3% after the Indonesian national airline became the first airline to request the cancellation of an order for 737 Max 8 jets, involved in two fatal crashes in the last six months.
(Photo: Getty Images)
Nike, another component of the Dow Jones Industrial Average, fell 5.3% after announcing weak sales in North America. And Greenbrier, a railway equipment manufacturer, dropped 9.7% after posting a dismal forecast.
Investors have invested in low-risk, high-dividend stocks. Utilities, real estate companies and consumer product manufacturers were the only sectors to grow.
These sectors have also become more attractive to investors seeking income as bond yields continue to fall.
Key bond yields fell this week to their lowest level for more than a year after the US Federal Reserve announced slower economic growth and no longer expects higher rates of return. interest this year.
Investors are also buying bonds and reducing yields as they fear a slowdown in economic growth elsewhere in the world, especially in Europe.
The yield on the 10-year Treasury, which is used to set mortgage rates and many other types of loans, fell to 2.43% from 2.54% on Thursday night, a big step forward. before. This is down sharply from its recent peak of 3.23% in early October.
Another worrying sign, the yield on the 10-year Treasury Note fell below the yield on the three-month Treasury Bill. Economists fear that such a "reversal" of bond yields will trigger a recession in the coming year. This signal is not always correct, however.
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KEEP THE SCORE: The S & P 500 index dropped 1.6% at noon. At this rate, the market would suffer its worst daily loss since January 3.
The Dow fell 342 points, or 1.3%, to 25,621 and the Nasdaq composite fell 1.8%.
The stock market has seen gains in losses throughout the week, but the S & P 500 is still close to its second consecutive gain and is up more than 12% for the year.
FOREIGN: European stocks were generally lower after surveys revealed a worsening of the slowdown in manufacturing in the region. The British FT-SE lost 1.6% and the French CAC 40, 1.5%.
TAKING THE ANALYST: Investors rebalance their holdings as they "digest the new reality" of slower growth, said Marina Severinovsky, investment strategist at Schroeders. "We're sort of coming back to Earth," she says.
Central banks have been preparing for the slowdown, she said, and that includes the Federal Reserve's expectations of not raising rates this year.
Earlier this month, the European Central Bank also took steps to reassure investors by stating that it would postpone the nearest date for rising interest rates. He also said that he would offer very cheap loans to the banks, thus strengthening their ability to continue lending.
"It is very positive that not only the Fed, but other politicians have recognized that the situation was rather dangerous for the global slowdown and were acting in this direction," said Severinovsky.
LOAC LACES: Nike stumbled after disappointing sales in its home market in North America, falling short of analysts' forecasts and warned of slowing sales.
The weak regional results overshadowed an otherwise strong third quarter for the sportswear manufacturer, better known for its sneakers and sneakers. Revenues and profits increased during the quarter, exceeding expectations.
Sales in North America make up the bulk of the company's revenue and shoes are the main driver of sales. The company faces constant competition from its German rival Adidas, which is working to strengthen its presence in North America.
GOOD SPORT: The regional sports goods retailer Hibbett Sports jumped 23% after canceling Wall Street's earnings forecast for the fourth quarter. The company announced a profit of 57 cents per share while analysts expected 39 cents per share.
The company operates most of its stores in Georgia, Texas and Alabama. The good results were driven by increases in sales at existing stores and online. Hibbett's planned profits for the year were also well above Wall Street's expectations.
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