On Wednesday, stocks fell sharply as concerns about potential delays in interest rate cuts weighed on investors. A busy day of corporate earnings reports, including those from Boeing (BA) and Tesla (TSLA), added to market jitters.
The Dow Jones Industrial Average (^DJI) dropped over 500 points, down by 1.2%, while the tech-heavy Nasdaq Composite (^IXIC) slid about 2%. The benchmark S&P 500 (^GSPC) was also down more than 1.3%.
Investor sentiment has soured as they debate how long the Federal Reserve will keep interest rates elevated before making cuts. This concern has pushed bond prices down, sending the 10-year Treasury yield (^TNX) to levels not seen since July. On Wednesday, the yield remained firmly above the 4.20% mark.
Tesla’s earnings report, due after the market closes, is eagerly anticipated. Investors are hoping for updates on the company’s lower-cost electric vehicle (EV), the specifics of its robotaxi initiative, and its focus on artificial intelligence (AI). The performance of tech giants such as Apple (AAPL), Alphabet (GOOGL, GOOG), Amazon (AMZN), Meta (META), and Nvidia (NVDA) was also under scrutiny, with all of them down more than 1% ahead of Tesla’s report.
Meanwhile, Boeing posted a significant loss in its quarterly report. Investors were also awaiting news on whether striking factory workers would accept a new pay deal. McDonald’s (MCD) shares were down over 4%, dragging on the Dow, after its Quarter Pounder burgers were linked to an E. coli outbreak in some states.
In other corporate news, Starbucks (SBUX) shares dropped about 1% after the company posted a surprising sales decline and withdrew its future guidance. This follows a deeper slump in extended trading.
The market is closely watching for further surprises as corporate earnings reports continue to come in.
