Stocks on Wall Street fell for a third straight week. The three main indexes dropped sharply Friday as Netflix’s sour earnings outlook dented investor sentiment.
The S&P and Nasdaq suffered their worst weeks since the start of the health crisis in March 2020. And the Nasdaq sank deeper into correction territory.
O’Neil Global Advisors Senior Portfolio Manager Randy Watts says the Nasdaq faces more downside risk.
“Over 25% of the NASDAQ is off 50% or more from its high, but I don't think time-wise we’re completely through with this correction. I still think it's a process. It has to continue, and we're likely to then trade sideways and consolidate a bit before heading back up.”
The Dow fell 450 points, or one-and-a-third percent. The S&P 500 plunged nearly 2%. And the Nasdaq plummeted two-and-three-quarter percent.
Netflix was the top decliner on the S&P. Shares plunged almost 22%. The world’s largest streaming service disappointed investors with its weak forecast for quarterly subscriber growth. That dragged down other streaming stocks, including Roku .. and Disney, which was the Dow’s top decliner.
Another so-called stay-at-home stock, Peloton, recouped some of Thursday’s steep loss, rising nearly 12%. The exercise bike maker denied a report that it was halting some production.
Next week, inflation-wary investors will closely watch the Federal Reserve’s meeting for clarity on its plans to tighten monetary policy.