Courier Company's Lowered Outlook Impacts Market
United Parcel Service Inc (NYSE: UPS) shares experienced a 9.8% drop, marking the largest one-day decline over eight years. This came after the courier company predicted full-year revenue at the lower end of its previous expectations due to a weakening economy. This negative forecast impacted the Dow Jones Transport Average index, which fell 3.6%, and FedEx Corp (NYSE: FDX), which lost 3%.
Falling Consumer Confidence and Tech Earnings Awaited
Investors anxiously await quarterly results from major technology companies, including Microsoft Corp (NASDAQ: MSFT). Additionally, concerns rise as U.S. consumer confidence data reveals a nine-month low in April. Carol Schleif, CIO for BMO Family Office, commented on the investor's struggle to maintain stability during a week of substantial earnings, economic data, and the upcoming Federal Reserve announcement.
Banking Sector Suffers as First Republic Shares Plummet
The KBW Regional Banking index dropped 3.4%, and the broader S&P 500 bank index fell 2.4% as First Republic Bank shares tanked 41%, hitting a record low. The bank reported over $100 billion in deposits during Q1, following the most significant banking crisis since 2008. Schleif emphasized the importance of regional banks' health for mid-size businesses in the U.S.
Major Indices Fall Amid Sector Weakness
The Dow Jones Industrial Average dropped 320.58 points (0.95%) to 33,554.82, the S&P 500 lost 57.86 points (1.40%) to 4,079.18, and the Nasdaq Composite decreased by 203.41 points (1.69%) to 11,833.80. Materials, consumer discretionary, and industrials sectors experienced the most significant losses.
Mixed Results from General Motors and PepsiCo
General Motors Co (NYSE: GM) saw a 3.8% drop after initially experiencing gains, as the automaker warned that price gains throughout 2022 would not last. On the other hand, PepsiCo (NASDAQ: PEP) Inc shares rose by 2% after increasing their annual revenue and profit forecasts, causing consumer staples stocks to outperform.
Major Companies' Earnings Reports Awaited
First-quarter S&P 500 earnings estimates have narrowed to a 3.9% decline from an initial 5.1% decline, according to Refinitiv data. However, some of the largest companies, such as Alphabet (NASDAQ: GOOGL) Inc and Microsoft, have yet to report their results.