The stock market’s rebound from Tuesday’s gains lost momentum on Wednesday, with the major averages closing in the red. The Nasdaq Composite led the losses, falling 1.1%, while the S&P 500 and Dow Jones Industrial Average declined 0.8% and 0.6%, respectively.
Chip stocks were among the biggest losers, with Nvidia (NVDA) dropping over 5%. The VIX, also known as Wall Street’s “fear gauge,” remained relatively unchanged, closing just below 28.
Earnings Disappointments
Several companies reported disappointing earnings results, including Airbnb (ABNB) and Super Micro Computer (SMCI). Airbnb’s stock fell nearly 14% after the company offered a current quarter forecast below expectations. Super Micro’s stock plummeted over 20% due to disappointing margins and the announcement of a 10-for-1 stock split.
Disney’s Mixed Results
Disney (DIS) reported a profit in its streaming unit for the first time last quarter, but concerns over the company’s park business led to a 4% decline in its stock.
Warner Bros. to Report Earnings
Warner Bros. Discovery (WBD) is set to report its second-quarter earnings after the bell, with investors closely watching for commentary on the loss of its NBA media rights. The company is expected to report a decline in revenue and adjusted loss per share.
Unemployment Claims in Focus
Thursday’s release of weekly jobless claims will be a key indicator of the economy’s health. Economists expect 240,000 claims to have been filed in the week ending August 3, down from 249,000 the previous week.
Market Outlook
Truist Co-CIO Keith Lerner warned of “choppy waters” in the market, citing the recent volatility spike. Lerner expects the market to remain choppy throughout August, with investors needing to see more economic data to confirm the economy isn’t headed into recession.
Citi head of US equity trading strategy Stuart Kaiser described Thursday’s jobless claims print as “very important,” with the options market implying a 1.2% move for the S&P 500 in either direction.
