- US stocks fell on Thursday after a slew of economic data suggested a recession is coming.
- Jobless claims, the Philly Fed Factory Index, and Leading Economic Indicators all had a weak showing.
- Disappointing earnings from Tesla and AT&T led to a 11% sell-off for both stocks.
US stocks fell on Thursday as investors digested weak corporate earnings and a slew of economic data that suggested a recession is all but certain.
Tesla reported results that disappointed investors, with the stock falling as much as 11%. The company said its gross margin fell below 20% as it implemented a number of price cuts for its vehicles during the quarter. AT&T also reported earnings that fell flat with investors, sending the stock down as much as 11%.
Meanwhile, weekly jobless claims jumped 5,000 to 245,000, slightly ahead of economist estimates of about 240,000. And the Philadelphia Fed Factory index reported another contraction in April, representing the eighth consecutive month of declines in manufacturing activity.
Finally, the Conference Board’s Leading Economic Indicators index showed a continued slide to levels last seen in November 2020, when the economy was still recovering from the COVID-19 pandemic.
“Historically, an economic contraction has closely followed a decline in the LEI of this magnitude. A recession is all but certain, so the more important question is if markets will hit new lows as the economy contracts. We think not,” LPL’s chief economist Jeffrey Roach told Insider.
Here’s where US indexes stood at the 4:00 p.m. ET close on Thursday:
Investors now will turn their attention to next week’s release of first-quarter earnings from mega-cap tech companies including Apple, Amazon, and Alphabet, among others.
Here’s what else happened today:
In commodities, bonds and crypto:
- West Texas Intermediate crude oil fell 2.64% to $77.15 per barrel. Brent crude, oil’s international benchmark, dropped 2.74% to $80.84.
- Gold rose 0.37% to $2,014.80 per ounce.
- The yield on the 10-year Treasury fell five basis points to 3.54%.
- Bitcoin fell 2.62% to $28,111, while ether dropped 1.13% to $1,928.