Page 12 - aruba-today-20221104

A12 BUSINESS
Friday 4 November 2022

On Wall Street, extreme punishments

for weak profit reports

By STAN CHOE
AP Business Writer
NEW YORK (AP) — When
it comes to meeting Wall
Street's expectations for
profit and sales, it's put-
up-or-get-beat-up time for
CEOs.
It hasn't happened very of-
ten, but when companies
have turned in both weak-
er profits and sales this re-
porting season than ana-
lysts expected, investors
have walloped them with
record-sized punishments Numbers for the Dow Jones Industrial Average are displayed on
for their stock prices. a screen at the New York Stock Exchange on Sept. 13, 2022.
Google's parent company The punishment has been extreme so far this earnings reporting
Alphabet, for example, season when companies report profits and sales that fall short of
committed the sin of re- expectations.
porting $69.1 billion in rev- for the overall market that perform 6.7 percentage
enue for its latest quarter, same day, as measured by points worse the next day
instead of the $71 billion the S&P 500. than the S&P 500, accord-
that Wall Street expect- Alphabet isn't alone in feel- ing to a recent BofA Global
ed, along with earnings ing the pain. With just over Research report. That's a
below forecasts. Its stock half of all S&P 500 com- much bigger hit than usual
plunged 9.1% the next day, panies having reported and potentially on track for
its second-worst showing in their results for the summer, a record.
more than a decade. That those that fell short of ex- The historical average is
was 8.4 percentage points pectations for both profits just a 2.4 percentage point
worse than the 0.7% drop and sales saw their stocks gap.q

Wall Street moves lower as Fed presses on

against inflation

By DAMIAN J. TROISE and Writers Street and Treasury yields
ALEX VEIGA AP Business Stocks are down on Wall are again bumping up
against multiyear highs
Thursday, a day after the
Federal Reserve indicated
that its fight against infla-
tion is far from over.
The S&P 500 fell 0.6% as
of 2:44 p.m. Eastern. The
benchmark index was
roughly split between gain-
ers and losers. The Dow
Jones Industrial Average
slipped 42 points, or 0.1%,
to 32,106. The tech-heavy
Traders work on the floor at the New York Stock Exchange in
New York, Tuesday, Oct. 4, 2022. Stocks are opening lower on Nasdaq fell 1.2%. The yield
Wall Street, Thursday, Nov. 3, and Treasury yields are again on the 10-year Treasury
bumping up against multiyear highs a day after the Federal rose to 4.12% from 4.09%
Reserve indicated that its fight against inflation is far from over. late Wednesday. Bond
yields are hovering around
multiyear highs as the Fed
raises interest rates. That
has prompted mortgage
rates to more than double
this year and it continues
putting pressure on stocks.
The yield on the two-year
Treasury, which tends to
track market expectations
of future Fed action, rose to
4.72% from 4.61%q