On Friday, a gauge of world stocks recorded declines to end the week lower, after having recorded gains for five sessions in a row. Meanwhile, the US dollar also declined against a basket of major currencies because the US business activity data turned out soft.

Heavy declines

Early trading had seen modest losses on Wall Street, but they turned into heavy declines because of the S&P 500, as earnings from Snap Inc. pushed down some names in Big Tech, such as Alphabet and Meta. Snap itself plunged by 39.08%. The few sectors that recorded gains included defensive ones like utilities and consumer staples.

Market analysts said that the bear market rallies were developing a pattern. A number of sharp rallies are recorded, which fade, and then there are new lows seen. They said that everyone was keeping an eye out on a turnaround and wanted to know when there will finally be a sustained rally. While there is a lot of hope, the future remains unknown for now.

By Friday morning, about 106 companies in part of the S&P 500 had reported their earnings and around 75.5% of them had posted results better than expectations. This was below the beat rate of 81% seen in the last four earnings sessions.

Indexes fall

There was a 0.43% drop in the Dow Jones Industrial Average, which declined by 137.61 points to reach 31,899.29, while a 0.93% loss was seen in the S&P 500. This brought the index down by 37.32 points to 3,961.63 points. As for the Nasdaq Composite, it recorded losses of 1.87%, which was a decline of 225.50 points down to 11,834.11.

The Dow had gained 1.96% for the week and a 2.56% weekly gain was recorded by the S&P 500. As for Nasdaq, it climbed by 3.33%. The gains for the first two indexes were the biggest weekly gains they had made in four weeks.

Economic data

On Friday, S&P Global said that its preliminary PMI Output Index had fallen this month to 47.5, which was more than expected and marked a contraction in the last two years. The figure had been 52.3 back in June.

According to recent data, the economy appears to be slowing down, but the US Fed is still expected to hike its interest rate by 75 basis points in its meeting in order to bring down inflation. On Thursday, the European Central Bank (ECB) also joined other global central banks to do the same, as it hiked its interest rate by 50 basis points, instead of the 25 bps hike it had promised earlier.

There was a 0.31% gain in the continent-wide STOXX 600 index and a 0.44% drop was recorded in the MSCI’s gauge of world stocks, after it had touched 623.79, which is the highest it has been since June 10th. There was a 3.1% weekly gain in the MSCI index. As for the STOXX 600, it saw its biggest gain in a week in two months, partly because concerns about a potential energy crisis had eased.