US Equity Indexes Decline Amid Market Concerns
US equity indexes saw a drop on Thursday, driven by a combination of weak earnings, economic data, and rising geopolitical tensions. Both the Nasdaq Composite and the S&P 500 declined by 0.7%, with the Nasdaq at 19,920.9 and the S&P at 6,103.04. Meanwhile, the Dow Jones Industrial Average fell by 1.3% to 44,055.66 by midday.
- Financials, consumer discretionary, and industrials were the sectors leading the decline, while healthcare and energy managed to stay in the green.
Economic Data and Earnings Impact
The latest economic data contributed to the market’s downturn. US initial jobless claims rose to 219,000 for the week ending February 15, slightly above expectations of 215,000.
- This increase reflects some weakness in the labor market, though the data remained close to forecasts, signaling mixed sentiment.
Additionally, the Conference Board’s leading indicators for January fell by 0.3%, surpassing the expected 0.1% decline. This came after an upwardly revised 0.1% rise in December.
- These indicators show a slower economic momentum, contributing to growing concerns over the direction of the economy.
Concerns Over Trade and Policy
In an essay published on Thursday, Atlanta Federal Reserve Bank President Raphael Bostic highlighted growing uncertainty around trade and immigration policies.
- While some optimism exists regarding potential tax and regulatory shifts, concerns remain about the impact of tariffs. Many companies expect rising costs, with confidence that they will pass these costs onto consumers through higher prices.
Geopolitical Tensions Add to Market Worries
Geopolitical developments also weighed on market sentiment. According to CNN, European leaders were taken by surprise by the recent sharp decline in US support for Ukraine. The report suggests that many are puzzled by President Donald Trump’s sudden pivot away from supporting Ukraine’s leader, Volodymyr Zelensky.
- These geopolitical uncertainties are adding to the broader market risk sentiment.
Treasury Yields and Currency Movements
In line with the equity market declines, US Treasury yields also fell. The 10-year yield dropped by 3.6 basis points to 4.50%, while the two-year yield slipped by 1.5 basis points to 4.26%.
- The dollar depreciated against the Japanese yen, falling by 1.2% to 149.5.
Company News and Performance
Several companies were in the spotlight due to their poor performance. Walmart was the biggest laggard on the Dow, falling 6.7% intraday after providing adjusted earnings guidance for Q1 and fiscal 2026 that fell short of analyst estimates.
- This performance reflects investor concerns over weaker-than-expected projections from key players.
EPAM Systems saw the biggest drop on the S&P 500, plummeting by 16% after its Q1 and 2025 non-GAAP EPS guidance trailed expectations compiled by FactSet.
- These earnings reports further deepened the market’s concerns about corporate performance.
