The major US stock indices are closing near there lows. The S&P and the NASDAQ index both closed lower on the day and snap their 3 day win streak. The Dow industrial average eked out a small gain extending its win streak to 4 trading days (but just barely).
A look at the final numbers shows:
- Dow industrial average is closing up 2.35 points or 0.01% at 31839.12
- S&P index is down -28.51 points or -0.74% at 3830.59
- NASDAQ index is down -228.11 points or -2.04% at 10971.00
- Russell 2000 is up 8.17 points or 0.46% at 1804.33
The lower yields in the US tried to help the price rebounded intraday. In addition Bank of Canada’s rate hike of 50 basis points which was less than the 75 expected helped. However the headwinds from major big caps including Microsoft (-7.72%), Google (-9.65%), and Boeing (-8.70%) was just too hard to overcome. Apple fell -1.92% and Amazon fell by -4.10%. Both will announce their earnings after the close tomorrow.
After the NASDAQ bounced up 11% over 8 trading days, why does the 2% decline today seem like the rally is already over and the major indices will rotate back to the downside?
Maybe it is that the old diehards like Microsoft, Google, Apple, Meta and Amazon are all reaching the point where earnings and revenue growth just can’t keep on going up at above double digit levels anymore. The rule of high numbers is weighing on all, which has the impact of lowering multiples as earnings growth moderates at the same time. That is not good news for those stock prices.