Major stocks across the Atlantic closed in negative territory and technology pulled Wall Street into the red. The report, which showed Americans more pessimistic about the outlook for the economy, didn’t help.
The Dow Jones industrial index fell 1.56% to 30,946.99 points, while the Standard & Poor’s 500 fell 2.01% to 3,821.55 points.
For its part, the Nasdaq Composite Technology Index fell 2.98% to 11,181.54. Despite this, it was the downfalls of giants like Amazon and Tesla that mostly took place.
Operators have taken another “reality shower” following a disturbing consumer confidence report, Bloomberg reports. The barometer of consumer expectations for economic development, reflecting a six-month forecast, fell to almost a decade’s low, discouraging investors.
The data comes at a time when analysts are still optimistic about corporate earnings in the quarter that is about to end, as record net profits are forecast for the S&P 500 group of companies.
However, the bleak economic outlook pushed Wall Street’s major indexes into negative territory after gaining about 1%.
The quarterly recovery in asset portfolios also caused volatility in Tuesday’s session.
For strategists at Goldman Sachs, earnings forecasts for companies this quarter are overly optimistic, which the bank says puts stocks at risk of further losses as Wall Street analysts cut their estimates.
Max Kettner, strategist at HSBC, also believes that stocks are not yet reflecting the impact of a potential recession and corporate results expectations are likely to be revised down.
