Dow slides more than 200 points, falling for the first time in six days
27 Jul 2021
U.S. stocks fell for the first time in six days on Tuesday ahead of quarterly earnings reports from several megacap technology companies.
The Dow Jones Industrial Average declined 240 points. The S&P 500 fell 0.5% and the Nasdaq Composite dipped 0.3%. The major averages are all slipping from their respective records reached in the previous session, on track to break their five-day winning streaks.
Shares of UPS tumbled more than 6% as its domestic revenue came up shy of estimates. The shipping company beat on the top and bottom lines, however, as a surge in e-commerce orders continued.
The sell-off on Wall Street followed yet another day of heavy losses in Asian markets. The Hang Seng index dropped more than 4% Tuesday amid Beijing’s intensified crackdown on tech and education companies.
Investors are awaiting the Federal Reserve’s update on its monetary policy as the central bank’s two-day meeting began. The Federal Open Market Committee will release a statement when the meeting concludes Wednesday, followed by Chairman Jerome Powell’s news conference.
“I empathize with Fed Chair Jay Powell as he walks a delicate tightrope — preparing markets for tapering while assuring that the Fed will be very patient and thoughtful as it starts its normalization process,” Invesco Chief Global Market Strategist Kristina Hooper said in a note.
The International Monetary Fund warned Tuesday that there’s a risk inflation will prove to be more than just transitory, pushing central banks to take pre-emptive action.
Shares of Tesla rose 0.7% following a better-than-expected second-quarter earnings report. The electric vehicle maker passed $1 billion in quarterly net income for the first time.
“It appears that we’re going to get really solid earnings from these companies and that should give a little bit of a boost to the market. Some of these names have already run so much this year that perhaps we don’t get a large bounce,” said Victoria Fernandez, Crossmark Global Investments’ chief market strategist.
“Apple may be your best opportunity to see some movement because they’ve been in more of a consolidation phase over the last few months,” Fernandez added.