4:15 pm: Gamestop short squeeze sends shares soaring
The DJIA closed 179 points lower, a 0.6% decline, at 30,997, and the S&P 500 dipped 12 points, 0.3%, to 3,841. The Nasdaq jumped into positive territory in the afternoon, ending up 12 points, less than 0.1%, at 13,543.
The trading day featured a 50% surge from GameStop Corp (NYSE:GME) to $64.75 — above its previous 2007 peak.
The reason could be a short squeeze from investors on Reddit's r/wallstreetbets, Barron's reported. Members have been promoting the stock, especially since Chewy Inc (NYSE:CHWY) cofounder and activist investor Ryan Cohen was named to the video game retailer's board of directors.
12:15 pm: Traders try to right the ship, make up some ground
Wall Street recovered slightly from big early morning losses, but the Dow was still down 83 points, 0.3%, at midday. The Nasdaq lost 4 points, less than 0.1%, to 13,527, and the S&P ticked down 5 points, 0.1%, to 3,848.
"The S&P 500 and the NASDAQ 100 have pulled back from yesterday’s record highs as traders are content to trim their exposure to stocks following the recent bullish run," CMC Markets UK analyst Madden wrote Friday. "US equities have registered impressive gains lately on the back of hopes for President Biden’s spending plans but the mood has mellowed a little."
Tech did its part to raise the tide. Microsoft Corporation (NASDAQ:MSFT) and Facebook Inc (NASDAQ:FB) were among the leaders, each picking up more than 1%.
10:15 am: Proactive North America headlines:
Loop Insights Inc (MTRX:CVE) (OTCQB:RACMF) provide venue management services for Las Vegas golf tournament
NexTech AR Solutions Corp (OTCQB:NEXCF) (NEO:NTAR) (FRA:N29) sells its Bitcoin holdings for a $200,000 profit
Trillion Energy International Inc (CSE:TCF) (OTCMKTS:TCFF) (FRA:3P2N) poised to start re-development at SASB gas field in Black Sea as commodity prices recover
GSRX Industries Inc (OTCPINK:GSRX) rebranding its corporate identity and opening new business vertical in restaurant industry
InnoCan Pharma Corporation (CSE:INNO) (OTCMKTS:INNPF) (FRA:IP4) reveals successful production of CBD-loaded liposomes under aseptic conditions
Loncor Resources Inc (TSX:LN) unveils non-brokered private placement of up to 10,000,000 units at a price of C$0.50 each for gross proceeds of up to C$5M
Melkior Resources Inc (CVE:MKR) (OTCMKTS:MKRIF) (FRA:MEK1) starts 700 meters of drilling at Maseres property in Urban-Barry camp
Vox Royalty Corp (CVE:VOX) closes acquisition of Breakwater Resources royalty portfolio
TomaGold Corp (CVE:LOT) (OTCMKTS:TOGOF) (FRA:OTM) encouraged by initial drilling at Obalski project in Quebec
Binovi Technologies Corp (CVE:VISN) (OTCMKTS:BNVIF) (FRA:2EYA) touts increased demand for neuro-vision technology in its 3Q
9:41 am: Wall Street starts in red
The main Wall Street indices opened on a negative footing on Friday morning as the looming prospect of extended coronavirus lockdowns left traders feeling uncertain.
In the early minutes of trading, the Dow Jones Industrial Average was down 0.56% at 31,002, while the S&P 500 dropped 0.47% to 3,834 and the Nasdaq fell 0.45% to 13,469.
Reports that China and Hong Kong have reintroduced lockdown measures and news that the UK government is considering closing its borders to prevent the importation of new cases will likely have dampened sentiment as investors worry the end of the pandemic could still be some way off despite dealing with the pandemic for just over a year at this point.
Also seeing a gloomy start to the New York session was IBM Corp (NYSE:IBM), which was down 9.9% at US$118.70 in early trading after reporting a drop in earnings and sales for its fourth quarter as well as its seventh consecutive year of income declines.
7:45 am: Wall Street set for softer open
All three of the main indices on Wall Street are expected to open lower on Friday morning as investor sentiment is weighed down by fears of more pandemic lockdown measures
The Dow Jones industrial average is expected to add to yesterday’s losses, opening 236 points lower at 30,940.
The S&P 500, which edged higher yesterday, is tipped to open 27 points in the hole at 3,826 while the Nasdaq Composite, which made modest headway on Thursday, is expected to open 201 points weaker at 13,330.
Global sentiment has been hit by the prospect of tougher lockdowns being introduced to combat the spread of the coronavirus while there is also speculation that Republicans will dig their heels in over President Biden’s US$1.9tln fiscal stimulus package.
Meanwhile, fourth-quarter earnings season remains in full flow with oilfield services provider Schlumberger NV (NYSE:SLB) topping expectations with adjusted earnings per share (EPS) of 22 cents; this was down from 39 cents a year earlier but ahead of the consensus forecast of 17 cents.
Elsewhere, David Madden at CMC Markets said shares in computer chip maker Intel Corp (NASDAQ:INTC) “saw a lot of volatility shortly before the close of trading in the US last night as it seems their fourth-quarter numbers were leaked and posted a little earlier than expected.”
The company is investigating reports that a graphic in the earnings was the subject of a hack, hence the numbers were released early.
EPS came in at US$1.52, compared to the consensus estimate of US$1.10.
It’s also Purchasing Managers’ Index (PMI) day across the globe and the US is no exception. It’s just the “flash” estimates – the first stab at the numbers – so the numbers may not move the market much.
The manufacturing PMI for January is expected to ebb to 56.5 from 57.1 in December while the services PMI is seen retreating to 53.4 from 54.8.
Yesterday was the day the housing starts data was released and today we get the exiting homes sales numbers, with economics predicting a fall to 6.56mln in December from 6.69mln in November.
Oil traders will be looking for the Department of Energy’s crude oil stockpile numbers, with expectations of a fall of 1,675k barrels after the previous week’s fall of 3,248k.
Four things to watch for on Friday:
- Earnings season continues to rumble on, with big firms such as railroad investment group Kansas City Southern (NYSE:KSU) and banking firm Regions Financial Corp (NYSE:RF) among those reporting quarterly numbers
- In the macro diary, US flash PMI readings for January will provide more insight on how the American economy has started 2021, and may show how high a mountain the new Biden administration has to climb to get the economy back on track
- Meanwhile, shares in Google parent Alphabet Inc (NASDAQ:GOOGL) may come into focus after the tech giant threatened to pull its search engine out of Australia if the national government pushed ahead with plans to make the company pay for news content
- Cryptocurrency Bitcoin could also attract attention as the digital coin stands on the cusp of its worst week since March, nearly falling below US$30,000