Stocks closed out the worst week with another drop as a warning from growing concerns about the US economy, one of Wall Street’s trailblazers.
Delivery giant after closing Thursday fedex (FDX, -21.4%) – whose financial results are often seen as a read on the broader economic situation – reported provisional fiscal first quarter profit and earnings numbers significantly lower than expected. Announced. The firm cited the recent acceleration in “softening of global trading volumes” and specifically pointed to “macroeconomic weakness in Asia and service challenges in Europe”. FDX also withdrew its full-year guidance and announced several plans to offset the impact of lower demand, including postponing staff hiring, closing 90 FedEx offices, and ending Sunday operations at some FedEx grounds. The company is on its earnings calendar and plans to report full quarterly results after the close of trading next Thursday.
Wall Street’s nerves were already fraying ahead of FedEx’s financial warning. This happens four times a year (the third Friday in March, June, September and December), sometimes with high volumes of trading and erratic movements in some or all of the market. there is.
For stocks, ETFs, mutual fund recommendations, and other investment advice, sign up for Kiplinger’s free Investing Weekly e-letter.
At the end, NASDAQ Composite decreased by 0.9% to 11,448. S&P500 Index is 0.7% off at 3,873, Dow Jones Industrial Average It was 30,822, down 0.5%. All three indices suffered significant weekly losses.
More stock market news today:
- small cap Russell 2000 It was 1,798, down 1.5%.
- US Crude Oil Futures It rose slightly to $85.11 per barrel.
- gold futures It rose 0.4% to close at $1,683.50 an ounce.
- Bitcoin 0.9% lower to $19,629.81. (Bitcoin he trades 24 hours a day. Prices reported here are as of 4pm)
- international paper (IP, -11.2%) and Packaging Corporation of America (PKG, -11.0%) fell sharply after Jefferies analyst Philip Ng downgraded packaging stocks to Underperform, the equivalent of selling. The downgrade “reflects a massive overstock of containerboards, indicating a sharp slowdown in orders and a broad base of downtime for even smaller players,” Ng wrote in a note. “Our contacts believe fourth-quarter price cuts are imminent, with 5% to 6% of new capacity coming online in the next 12 months still impacting the market. The situation could be worse in 2023.
- Growth stocks were some of the biggest losers of the day. meta platform (meta, -2.2%), Twilio (TWLO, -4.8%) and snowflake (SNOW, -6.1%) We see a big drop.
Why low volatility funds are a good strategy
Don’t be disappointed. Yes, these are difficult times for the stock market. More volatility is likely. But investing is a marathon, not a sprint, and there are ways to weather the storm. More recently, we mentioned using quality high-income stocks like Dividend Kings and Dividend Aristocrats, all of which have decades of steady dividend growth.
However, given the panic selling this week, it seems like the perfect time to revisit low volatility strategies. “Minimizing volatility is a defensive bet,” said Huw Roberts, head of analytics at data research firm Quant Insight. “The overall aim is to keep people investing in the market, but the targets are stocks that don’t fluctuate as much or that don’t always behave in the same way as the overall index (S&P 500, for example).” Hugh added that going this route could be a good strategy for those “concerned about inflation, Fed rate hikes, etc.” We’ve rounded up 10 low volatility funds. Check them out.