Wealth

The stock market often doesn't know more about the economic future than anybody else: Expert



Jeff Mills, Bryn Mawr Trust CIO, and Richard Bernstein, Richard Bernstein Advisors CEO and CIO, join ‘Power Lunch’ to discuss the state of the markets and what they are advising their clients.

Stock futures fell sharply on Thursday night as traders pored through the latest batch of big tech earnings after Wall Street wrapped up its best month in decades.

Dow Jones Industrial Average futures traded 300 points lower, or more than 1%. S&P 500 and Nasdaq 100 futures also dropped more than 1%.

Apple reported quarterly earnings that topped analyst expectations, but its revenue growth remained flat on a year-over-year basis. Also, the company did not offer guidance for the quarter ending in June amid uncertainty over the coronavirus outbreak. The tech giant’s stock traded more than 1% lower in after-hours trading.

Amazon, another tech giant, saw its shares tumble 5% in after-hours trading after announcing plans to spend all its second-quarter profits on its coronavirus response. The e-commerce behemoth also posted a first-quarter profit that missed analyst expectations.

Both Apple and Amazon are among the companies that led the S&P 500′s comeback from the late-March lows and were two of the best performers in April. Amazon rallied nearly 27% in April while Apple jumped 15.3%.

“Dependency on a handful of stocks has masked broadly based weakness in the past, and if they falter, could obscure broadly based improvements going forward,” said Willie Delwiche, investment strategist at Baird, in a note.

Wall Street was coming off its biggest monthly surge in over 30 years, with the S&P 500 gaining 12.7% while the Dow advanced 11.1%. It was the third-biggest monthly gain for the S&P 500 since World War II. The Nasdaq Composite closed 15.5% higher for April, logging in its biggest one-month gain since June 2000.

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