Here are the most important news, trends and analysis that investors need to start their trading day:
- Wall Street's worst market sell-off since March 2020 continues
- Dow stocks Chevron, Caterpillar hitting Dow futures after earnings
- Apple shares holding on to gains after strong quarterly results
- Robinhood shares sink after the trading app warns on Q1 revenue
- Home Depot names a company veteran to become its next CEO
Volatility persisted Friday, with Dow futures swinging wildly. Dow stock Chevron fell more than 4% in the premarket, retreating from a record after an earnings miss. Apple, also a Dow component, was a bright spot in what's shaping up to be another crazy day, rising nearly 3% in the premarket following strong earnings. Nasdaq futures were flipping between gains and losses.
The Nasdaq and S&P 500 gave up gains intraday Thursday and closed negative. They're both now in correction territory, sitting 17.6% and 10.2% below their respective record highs. The S&P 500 is headed for its worst month since March 2020. The Dow closed slightly lower Thursday, giving up an over 600-point advance earlier in the session. The 30-stock average was 7% below its most recent record close.
The Federal Reserve's favorite inflation gauge showed its biggest year-over-year increase since September 1983. December's core PCE price index, excluding the food and energy sectors, jumped 4.9% from a year ago. November's number increased 4.7% year over year. Following the Fed's two-day January meeting earlier this week, central bankers signaled the first Covid-era interest rate hike as soon as March to fight rising inflation.
Chevron shares on Friday were pulling back from an all-time high in the prior session. The energy giant before the bell reported lower-than-expected adjusted fourth-quarter earnings. Revenue of $48.13 billion beat expectations. The results come as oil stages a blistering recovery from its pandemic-era lows, with international crude prices and U.S. oil prices trading at more than seven-year highs.
Another Dow stock, Caterpillar, fell 4% in the premarket, contributing to the overall market malaise. Increased costs weighing on the company's profit margins overshadowed better-than-expected earnings and revenue in the fourth quarter. The heavy equipment maker's sales were up 23% from a year earlier despite supply chain constraints.
After the bell Thursday, Apple reported record revenue for its December quarter, despite supply chain disruptions cutting into sales. Apple beat analyst estimates for sales in every product category except iPads. Adjusted per-share earnings also topped expectations.
CEO Tim Cook told CNBC those supply chain challenges are showing signs of improvement. He also addressed rising prices: "I think everybody's seeing inflationary pressure. There's no two ways about that." Apple ended its December quarter with a net cash position of $80 billion. Management once again reiterated the goal of reaching a "net cash neutral position over time."
Shares of Robinhood sank nearly 12% in Friday's premarket, the morning after the stock trading app reported a wider-than-expected quarterly loss. While revenue in the final three months of 2021 was slightly above estimates, Robinhood warned that revenue in the current quarter could fall significantly from a year ago. The newly public online brokerage is about to face its toughest comparisons in the first and second quarters of 2022, following records in early 2021 from meme stock mania that was kicked off by the epic GameStop short squeeze.
Home Depot shares were steady in premarket trading, following the late Thursday announcement that Chief Operating Officer Ted Decker will step into the role of CEO, effective March 1. The retailer's current CEO, Craig Menear, 64, will continue to serve as chairman of the board. Menear has been at the retailer for more than 20 years and began as CEO in November 2014. Decker, 58, has risen through the ranks at Home Depot since joining the company in 2000. Home Depot has seen tremendous growth during the Covid pandemic.