Stocks slide amid Afghanistan chaos
Fed Chairman Jerome Powell speaks at Fed symposium on Friday
How are markets reacting to Afghanistan chaos?
Michael Lee Strategy founder Michael Lee weighs in on the Biden administration’s Afghanistan withdrawal and today’s markets.
U.S. stock indexes fell Thursday as chaos deepened in Afghanistan following two explosions outside the airport in Kabul.
The Dow Jones Industrial Average lost 192 points or 0.54%, while the S&P 500 and the Nasdaq Composite declined 0.58% and 0.64%, respectively. Both the S&P 500 index and the Nasdaq Composite index closed at all-time highs on Wednesday.
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| I:DJI | DOW JONES AVERAGES | 44782 | -128.65 | -0.29% |
| SP500 | S&P 500 | 6047.15 | +14.77 | +0.24% |
| I:COMP | NASDAQ COMPOSITE INDEX | 19403.947849 | +185.78 | +0.97% |
At least 12 U.S. service members were killed and over a dozen others were injured in an explosion outside the Abbey Gate at the Hamid Karzai International Airport in Kabul, Afghanistan. A second explosion and gunfire near the airport were also reported.
President Biden is expected to address the nation at 5 pm ET.
The Fed’s virtual Jackson Hole Symposium kicked off on Thursday, but the key event will be Chairman Jerome Powell’s speech on Friday that could signal when the central bank could begin to scale back its asset purchases and eventually raise interest rates in an effort to rein in inflation.
Ahead of Powell's remarks, Kansas City Fed President Ester George gave her own assessment of the economy in an interview with FOX Business.
"I think as we look at the outlook for the economy there has been good progress on the labor market front, certainly the inflation numbers are coming in strong would suggest that there's an opportunity to begin to dial back on asset purchases so that adjustment process the conversation about that is already underway," she said.
KC Fed president: Better to taper sooner rather than later
Kansas City Federal Reserve Bank President Esther George on the U.S. economy and tapering measures.
In economic data, second-quarter gross domestic product was revised up to 6.6% growth from the initial estimate of 6.5%. This as initial jobless claims ticked up to 353,000, but remained near a pandemic-era low.
FED CHAIR POWELL MAY NOT DELIVER TAPERING ROADMAP AT JACKSON HOLE
In stocks, financials were in focus as investors looked ahead to Powell’s speech and clues for when rate hikes might begin.
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| XLF | FINANCIAL SELECT SECTOR SPDR ETF | 50.85 | -0.50 | -0.97% |
| JPM | JPMORGAN CHASE & CO. | 246.25 | -3.73 | -1.49% |
| GS | THE GOLDMAN SACHS GROUP INC. | 601.73 | -3.84 | -0.63% |
Elsewhere, Western Digital Corp. and Japan’s Kioxia Holdings Corp. are in talks to merge in a more than $20 billion deal that would create a giant chipmaker, according to The Wall Street Journal, citing people familiar with the matter.
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| WD | WALKER & DUNLOP | 110.18 | -0.64 | -0.58% |
In earnings, Salesforce.com Inc.’s quarterly results topped analysts’ expectations and the company raised its full-year earnings forecast after closing its acquisition of workplace messenger Slack.
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| CRM | SALESFORCE INC. | 330.81 | +0.80 | +0.24% |
Dollar General Corp.’s full-year profit forecast missed estimates as the company worried higher costs would hurt margins. Rival Dollar Tree Inc. slashed its annual profit forecast amid similar concerns and noted supply chain issues.
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| DG | DOLLAR GENERAL CORP. | 77.79 | +0.52 | +0.67% |
| DLTR | DOLLAR TREE INC. | 72.81 | +1.54 | +2.16% |
Kitchenware and home goods retailer Williams-Sonoma Inc. raised its quarterly dividend by 20.3% to 71 cents per share and announced a new $1.25 billion share buyback program. The company’s earnings and sales exceeded Wall Street estimates.
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| WSM | WILLIAMS-SONOMA INC. | 172.49 | -2.55 | -1.46% |
Cosmetics maker Coty Inc. reported better than expected top and bottom-line results and forecast annual sales growth for the first time in at least three years. Beauty products retailer Ulta Beauty Inc. also issued a strong full-year sales forecast.
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| COTY | COTY INC. | 7.39 | -0.02 | -0.27% |
| ULTA | ULTA BEAUTY INC. | 386.64 | +11.39 | +3.04% |
In commodities, West Texas Intermediate crude oil slid 94 cents to $67.42 a barrel and gold ticked up $4 to $1792.20 an ounce.
Overseas markets were mostly lower.
European bourses were under modest selling pressure with Germany’s DAX 30 declining 0.42%, France’s CAC 40 sinking 0.16% and Britain’s FTSE 100 slipping 0.35%.
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In Asia, South Korea’s Kospi lost 0.58% after the Bank of Korea hikes interest rates.
Elsewhere in the region, Hong Kong’s Hang Seng index and China’s Shanghai Composite lost 1.08% and 1.09%, respectively, while Japan’s Nikkei 225 eked out a 0.06% gain.