Wall Street down, Snap's warning casts a chill, Corporate news - DALTONHURD

Wall Street down, Snap’s warning casts a chill, Corporate news

PARIS, May 24 (Reuters) – The New York Stock Exchange fell back at the open on Tuesday amid concerns over the impact of inflation on corporate earnings after Snap issued a warning the day before. Snapchat app owner.

In early trading, the Dow Jones index lost 194.97 points, or 0.61%, to 31,685.27 points and the broader Standard & Poor’s 500 fell 1.12% to 3,928.89 points.

The Nasdaq Composite lost 1.81%, or 209.19 points, to 11,326.08.

Snap, which fell 35% on Tuesday, issued a second-quarter earnings warning the day before because, the group said, of the “faster and sharper than expected deterioration in the macroeconomic environment”. In its wake, Alphabet, Twitter, Meta Platforms and Pinterest fell 3% to 17%.

“Snap’s warning raises concerns that ad spending is now at an all-time high,” said Russ Mould, chief investment officer at AJ Bell.

“When the (economic) outlook is bleaker, advertising spending is reduced,” he adds, noting that this weighs on the morale of investors, many of whom had hoped that the fall in the markets was about to hit the bottom line. bottom.

The persistent concerns of recent weeks related to inflation, the continuation of the rate hike by the Federal Reserve or the consequences of Russia’s military offensive in Ukraine have in this context spread to the markets.

Sign of nervousness, the CBOE index measuring volatility, also called the “fear” index, returned close to 30 points.

Outside of values ​​linked to social networks, Airbnb dropped 2.7%, the short-term accommodation rental specialist having announced its withdrawal from China as of July 30.

Tesla lost almost 4%, penalized by Daiwa Capital’s lowering of the automaker’s delivery forecasts for this year and a reduction in its price target.

In business results and outlook, those of Zoom Video Communications (+5.4%) and Best Buy (+3.8%) are welcomed, while those of Ralph Lauren (-2.1%) and Abercrombie & Fitch (-26%) are sanctioned.

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