Stock Market News for Apr 20, 2023

·3 min read

U.S. stocks closed little changed on Wednesday for the second consecutive session, with the earnings season getting into full swing as investors digested another batch of mixed corporate earnings. The Dow ended in negative territory, while the Nasdaq closed in the green. The S&P 500 ended nearly flat.

How Did The Benchmarks Perform?

The Dow Jones Industrial Average (DJI) declined 0.2% or 79.62 points to finish at 33,897.01 points.

The S&P 500 fell less than 1 point to end nearly flat at 4,154.52 points. Utilities and real estate stocks were the best performers, while communication services stocks took a hit.

The Utilities Select Sector SPDR (XLU) rose 0.8%, while the Real Estate Select Sector SPDR (XLRE) gained 0.6%. The Communication Services Select Sector SPDR (XLC) declined 0.8%. Seven of the 11 sectors of the benchmark index ended in negative territory.

The tech-heavy Nasdaq gained less than 0.1% or 3.81 points to close at 12,157.23 points.

The fear-gauge CBOE Volatility Index (VIX) was down 2.20% to 16.46. Decliners outnumbered advancers on the NYSE by a 1.28-to-1 ratio. On Nasdaq, a 1.11-to-1 ratio favored declining issues. A total of 10 billion shares were traded on Wednesday, lower than the last 20-session average of 10.6 billion.

Investors Weigh in Corporate Earnings

Wall Street ended little changed on Wednesday for the second consecutive day. This came as the earnings season got into full swing as a spate of big banks, medical technology and a few tech companies reported their quarterly results on Wednesday.

Investors’ focus has lately shifted to the earnings season from the Fed’s interest rate hike trajectory. Investors are closely watching the banking sector report quarterly results this earnings season after several regional banks, including the Silicon Valley Bank and Signature Bank, failed last month.

They are also awaiting the quarterly results from the big tech companies as they will try to assess their performance given the size of the market share they hold.

Among big companies that reported quarterly reports on Wednesday, Morgan Stanley (MS) posted an earnings beat. Morgan Stanley reported first-quarter 2023 earnings of $1.70 per share, surpassing the Zacks Consensus Estimate of $1.67 per share.

The bank’s shares closed 0.7% higher. Morgan Stanley has a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.

Shares of Netflix, Inc. (NFLX) ended 3.2% lower after the streaming giant postponed plans of a crackdown on password sharing.

It has so far been a decent earnings season, with the majority of the company reporting a positive earnings beat. However, stocks have failed to find direction as a lack of forecasts from a large number of companies has left investors on the edge. This resulted in a choppy trading session on Wednesday.

Treasury Yield Rises

The 2-year Treasury Yield jumped 6 basis points on Wednesday to reach 4.246% as chances of the Fed going from another 25-basis point rate hike in its next meeting in May are increasing. A jump in treasury yield weighed on growth stocks, with shares of Alphabet Inc. (GOOGL) declining 0.3%. Shares of Meta Platforms, Inc. (META) closed 1% lower.

Separately, the Fed Beige Book released on Wednesday showed economic activity in the United States was “little changed” in March and in early April.

Investors are now awaiting corporate results from big tech companies.

No major economic data was released on Wednesday.

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