On Monday, the US stock indices declined sharply because of investors' concern about the quarterly earnings results of Meta Platforms and other large IT corporations.
The S&P 500 index lost 0.4% and ended the session at 4,483.87, while the Nasdaq Composite sank by 0.6% to 1,4015.67.
The Dow Jones Industrial Average rose by less than 0.01% and closed at 3,5091.13. Among companies included in the index, shares of Boeing Co and Chevron Corp showed the biggest gains. Their shares increased by 2.7% and 2%, respectively. Microsoft Corp shares declined by 1.6%, Merck & Co Inc. shares tumbled by 1.3%. and Dow Inc. dropped by 1.1%.
Last week, the main US stock indices grew by 1.1%-2.4%. At the same time, since the beginning of the year, the S&P 500 index has lost more than 5% due to concerns about monetary policy tightening by the Fed earlier than predicted. Analysts believe that the regulator is likely to tighten monetary policy amid rising inflation and rapid recovery of the labor market.
Volatility in the stock market has significantly increased because of price changes in IT stocks. Last week, there was a record drop in shares of Facebook's subsidiary company - Meta Platforms. Amazon shares saw the biggest rise in the six years thanks to the publication of earnings reports.
In addition, the 10-year US government bond yield declined sharply to 1.915% from 1.930% the day before. US Treasuries are hovering near the highs of early January in anticipation of the Fed's hawkish stance. The central bank is excepted to hike the key rate in March.
As a result, at Monday's session, Meta Platforms lost 5.1%, Nvidia rose by 1.7%, and Peloton Interactive Inc. soared by 21% amid rumors that Amazon and Nike are considering buying a sports equipment manufacturer.
Shares Tyson Foods Inc., the US food industry giant, jumped by 17% following the earnings report. The company doubled its net profit in the first quarter of the fiscal year 2022. On top of that, the corporation's revenue significantly exceeded forecasts.
Spirit Airlines stocks rose by 17% on news of a merger with the ultra-low-budget Frontier Group Holdings Inc. whose shares jumped by 3.5%.
Shares of US motorcycle manufacturer Harley-Davidson Inc. moved up by 1% after the earnings report. The company increased quarterly dividend payments by 5%.
Hasbro Inc. stocks lost 1% despite the growth of the company's revenue in the 4 quarter of 2021 versus the forecast reading.
This week, investors will mainly focus on the US inflation report for January, which is due on Thursday. According to preliminary estimates, consumer prices grew by 7.3% year-on-year and by 0.5% versus the December reading.
Pfizer, Uber Technologies, Walt Disney, Coca-Cola, and Twitter will unveil their quarterly earnings results at the end of the week.
As for the already published financial reports, analysts find them quite positive. About 75% of companies from the Standard and Poor's 500 index have already unveiled results for the last quarter. Their profit exceeded analysts' expectations by 8%.
