US stocks slumped on Thursday, with the S&P 500 falling 1.2% and the Nasdaq dropping 2.2%, as oil prices surged above $100 a barrel. The rise in oil prices was driven by concerns over supply disruptions in the Middle East.
Market Moves
European stocks also fell, with the UK’s FTSE 100 index down 0.7% and the Euro Stoxx 50 index down 1.3%. In Asia, South Korea’s Kospi index rose 4% and Japan’s Nikkei 225 index gained 0.5%.
The US dollar rose against the euro and the yen, with the dollar/yen exchange rate reaching a new 40-year high. Bond yields also rose, with the 2-year US Treasury yield reaching its highest level in 18 months.
Earnings Reports
Alphabet and Tesla reported earnings after the bell on Wednesday, with both companies showing significant cash burn. Alphabet’s free cash flow turned negative for the first time in over 20 years, while Tesla’s free cash flow turned negative for the first time in two years.
The surge in oil prices and the earnings reports from Alphabet and Tesla have raised concerns about the health of the US economy. The Federal Reserve is expected to raise interest rates in the coming months to combat inflation, which could further slow down the economy.
Original reporting: Appleton, WI News Feed (HLL/CB) — read the source article.
