Stocks down after Wednesday’s rally

US stocks tumbled Thursday morning as the December sell-off resumed after a rally in the previous session that didn’t hold up.

The S&P 500 (^GSPC) fell 1.7% shortly after the open, while the Dow Jones Industrial Average (^DJI) fell nearly 450 points, or 1.4%. The tech-heavy Nasdaq Composite (^IXIC) plunged 2.4% towards its 2022 lows.

The moves come after all three major averages posted gains of at least 1.5% on Wednesday, boosted by a rebound in consumer attitudes about inflation and the broader economy and optimistic Nike (NKE) earnings which at least temporarily , fears about the corporate outlook have eased .

However, poor results from Micron Technology (MU) have soured the mood. The largest US memory chip maker has warned of a glut in the semiconductor market and expects a larger-than-expected second-quarter loss as a result. The company also revealed a number of cost-cutting measures to help offset an expected decline in revenue, including a 10% reduction in workforce. Shares fell 4.2%.

Meanwhile, Under Armor (UA) has named Marriott International president Stephanie Linnartz as its next chief executive officer, wrapping up a seven-month search for a new leader. Linnartz, who was one of 60 candidates being considered, is expected to take up the job on Feb. 27, according to the company. Shares of Under Armor fell 2.6% at the start of the session.

On the economic data front, jobless insurance claims rose slightly to 216,000 in the week ending Dec. 17, the Labor Department said Thursday, a modest increase from an upwardly revised 214,000 the week before.

In commodity markets, oil was up for the fourth straight day amid winter weather in the US and forecasts of a storm heading towards North America. Futures on West Texas Intermediate (WTI) crude oil – the US benchmark – rose about 1.2% to $79 a barrel.

“Energy stocks are in gear again, thanks to a fourth consecutive session in crude oil prices amid expectations of higher demand over the holiday period,” said Susannah Streeter, senior investment and markets analyst at Hargreaves Lansdown in a note sent by email. . “But gains are limited by lingering concerns against the backdrop of next year’s global economic outlook.”

NEW YORK, NEW YORK - DECEMBER 21: Traders work on the floor of the New York Stock Exchange during afternoon trading on December 21, 2022 in New York City.  Shares closed strong today for the second straight day with the Dow Jones closing above 500 points amid a better-than-expected Consumer Confidence report from the Conference Board.  (Photo by Michael M. Santiago/Getty Images)

NEW YORK, NEW YORK – DECEMBER 21: Traders work on the floor of the New York Stock Exchange during afternoon trading. (Photo by Michael M. Santiago/Getty Images)

In the cryptocurrency world, the events of the saga of the collapse of the FTX cryptocurrency exchange continued to unfold. FTX co-founder and former CTO Gary Wang and former Alameda Research CEO Caroline Ellison pleaded guilty Wednesday to charges related to their roles in fraud that contributed to the company’s collapse.

Investors are waiting to see if there is a Santa Claus rally this year, a seasonal rally in the stock market that tends to occur towards the end of December. But a so far downbeat month plagued by worries about inflation, rising interest rates and the likelihood of a recession have thrown a wrench in year-end earnings hopes.

“We think the economy and markets are simply recalibrating towards higher interest rates and slower growth,” Yung-Yu Ma, Chief Investment Strategist at BMO Wealth Management, said in a statement, indicating the record stimulus and momentum. economy in 2021 which led to higher inflation.

“Everything that reversed a year created in 2022 where there really was a pullback.” said mom. “As a result, we expect 2023 to be a recalibration from what we consider normal times.”

Alexandra Semenova is a reporter at Yahoo Finance. Follow her on Twitter @alexandraandnyc

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