Here are the top news, trends, and analysis that investors need to get their trading day started:
1. Dow will extend the sell-off if the futures fall again
Traders on the floor of the New York Stock Exchange.
The blue-chip Dow Jones industry average is expected to extend heavy losses on Wednesday after above-forecast consumer prices caused investors to dump risk-weighted assets. Dow Jones Industrial Average futures fell 90 points on Thursday. Nasdaq futures and those linked to the S&P 500 have eliminated previous losses and traded in the green. In the previous session, the Dow fell more than 600 points by 30 stocks, marking its worst day since January. The S&P 500 was down 2.1%, its largest one-day decline since February, while the tech-heavy Nasdaq Composite was down 2.6%. The major indices saw large losses through the middle of the week, with the S&P 500 falling 4% by the close of trading on Wednesday. The Dow was down 3.4% while the Nasdaq underperformed, down 5.2% as tech stocks were particularly hard hit amid higher inflation and interest rates.
2. Another inflation indicator is hotter than expected
Workers make steel rebars that are used in support structures such as the Lincoln Tunnel
Stephanie Dhue | CNBC
Companies paid producers much higher prices for everything from steel to meat in April, another sign of inflation in an economy rapidly recovering from the pandemic. The new data comes a day after a sharp surge in consumer prices rocked the stock market. The producer price index rose 0.6% last month, according to the US Bureau of Labor Statistics. In the twelve months that ended in April, the reading rose 6.2%. This was the largest increase since the agency began collecting data in 2010. Economists surveyed by FactSet expected the PPI to grow 0.3% in April compared to the previous month. According to FactSet, the index should increase by 3.8% compared to the previous year.
3. The cryptocurrency market falls after Tesla stopped buying cars with Bitcoin
Artur Widak | NurPhoto | Getty Images
Bitcoin and other digital token prices fell sharply, wiping hundreds of billions of dollars off the overall cryptocurrency market after Elon Musk, CEO of Tesla, tweeted that the electric vehicle maker would stop buying cars with bitcoin. Bitcoin fell more than 10% after Musk’s surprising reversal. The world’s largest cryptocurrency fell below the $ 50,000 mark for the first time since April 24, according to CoinDesk data. Other cryptocurrencies Ether and XRP were also significantly lower.
Coinbase, which just went public with the promise that crypto trading will go mainstream, fell 5% in premarket trading after Musk’s comments. Along with Tesla, the shares of other companies that own significant Bitcoin stakes fell, with MicroStrategy down 6% in the pre-market.
4. The Colonial Pipeline is restarted after a ransomware attack
Tankers can be seen on adjacent property next to the entrance to the Colonial Pipeline terminal in Charlotte, North Carolina on May 12, 2021.
Logan Cyrus | AFP | Getty Images
Colonial Pipeline started operations five days after a ransomware attack that took the entire system offline. However, the company warned that its pipeline would not be fully operational immediately. “After this restart, it will take a few days for the supply chain for product delivery to return to normal,” said Colonial on Wednesday evening. “Some markets served by Colonial Pipeline may or continue to experience intermittent business interruptions during the launch phase. Colonial will and will continue to move as much gasoline, diesel and jet fuel as possible until markets return.” too normal. “
Most of the 5,500-mile pipeline, which provides roughly half of the east coast’s fuel, has been offline since Friday. The shutdown sparked fears of a gas shortage and pushed the national average for a gallon of gas above $ 3 for the first time since 2014.
5. The son of SoftBank expects even more massive returns after blowing out
Masayoshi Son, Chairman and CEO of SoftBank, reacts during a dialogue session with Jack Ma, former chairman of Alibaba, not pictured, at Tokyo Forum 2019 in Tokyo, Japan on Friday, December 6, 2019.
Kiyoshi Ota | Bloomberg via Getty Images
Masayoshi Son, CEO of SoftBank, told CNBC that he expects more company exits from the Vision Fund’s portfolio to go public. “I want to create an ecosystem … in which several companies go public,” Masa Son said in an interview with Andrew Ross Sorkin, which was taped on Wednesday evening. He said 14 of SoftBank’s Vision Fund companies have had an IPO or other exit in the past 12 months, up from eight the previous year.
His comments followed a quarterly blowout report from SoftBank. SoftBank reported net earnings of $ 45.88 billion for the most recent quarter on Wednesday, largely thanks to the IPO of one of the crown jewels of its Vision Fund portfolio, South Korean e-commerce company Coupang. Son also talked about his regrets over the botched IPO of WeWork and investments he missed out on, like Airbnb.
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