BY THE NUMBERS
U.S. stock futures fell on the first trading day of May. The Nasdaq closed out April with its worst monthly performance since 2008 as investors faced headwinds that aren't going away anytime soon from a more hawkish Federal Reserve to rising bond yields to persistent inflation to Covid case spikes in China and Russia's ongoing war in Ukraine. (CNBC)
The Nasdaq sank 4% alone Friday en route to a nearly 13.3% loss for April. Tech stocks were the epicenter in last month's sell-off, capped with Amazon's 14% decline Friday, its biggest one-session drop since 2006, after reporting a weak quarter. Amazon was losing nearly 2% in Monday's premarket.
Breaking two-session winning streaks, the Dow Jones Industrial Average and the S&P 500 on Friday lost 2.8% and 3.6%, respectively. The Dow and S&P 500 had their worst months since March 2020, the month the Covid pandemic was declared. The Dow sank 4.9% for April. The S&P 500 dropped 8.8% last month.
Earnings season continues this week, though at a slower pace. So far, the March quarter blended earnings growth rate, which includes reported results and estimates from S&P 500 companies yet to report, is 7.1%. If that were to be the final rate for the quarter, it would mark the slowest year-over-year advance since the December quarter of 2020.
The 10-year Treasury yield on Monday was making a run at 3% again, trading around its recent late 2018 high of 2.94%. The Fed's two-day May meeting ends Wednesday, with expectations for a 50 basis point increase in interest rates. U.S. oil prices, while falling 3% on Monday, were still above $100 per barrel.
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IN THE NEWS TODAY
Warren Buffett told CNBC's Becky Quick that Berkshire Hathaway bought an additional $600 million worth of Apple shares following a three-day sell-off earlier last quarter. Buffett said: "Unfortunately the stock went back up, so I stopped. Otherwise who knows how much we would have bought." Buffett's comments came on the sidelines this weekend's Berkshire's annual shareholders meeting in Omaha, Nebraska. (CNBC)
* Berkshire earnings decline in Q1 on slowing economic growth, market pullback (CNBC)
On Saturday, Buffett said Berkshire now owns about 9.5% of Activision Blizzard, betting that Microsoft's proposed acquisition of the video game company will close. According to a recent filing, Berkshire's Chevron investment was worth $25.9 billion at the end of March, a big jump from its value of $4.5 billion at the end of 2021. (CNBC)
Spirit (SAVE) shares fell 8% in the premarket after the airline on Monday said it's rejected a $3.6 billion cash takeover bid from JetBlue (JBLU). Spirit said a deal with JetBlue would unlikely be able to be completed. Spirit is sticking with plans to merge with rival budget carrier Frontier (ULCC). (WSJ)
According to Moderna, its Covid vaccine for children under 6 years old will be ready for review by a Food and Drug Administration panel when it meets in June. Moderna applied for emergency use authorization for the treatment last week. Moderna's vaccine could be the first to win U.S. approval for children under the age of 5. (Reuters)
Civilian evacuations from the embattled city of Mariupol's last holdout, the blockaded Azovstal steel plant, are set to continue, Ukraine's government has said after about 100 civilians were evacuated on Sunday. Explosions were reported in the Russian border city of Belgorod. (CNBC)
STOCKS TO WATCH
China-based online gaming company Bilibili (BILI) slid 4.2% in the premarket after Jefferies cut its price target to $51.30 from $61.50 per share, citing Bilibili's recent cut in its revenue outlook due to the resurgence of Covid cases in China.
Moody's (MCO) missed estimates by a penny a share, with quarterly profit of $2.89 per share. Revenue was slightly above analysts' projections. The credit ratings company also cut its full-year revenue outlook due to its expectation of continued market volatility, and the stock fell 3.6% in the premarket.
Global Payments (GPN) reported quarterly profit of $2.07 per share, beating estimates by 3 cents a share. Revenue also topped analysts' forecasts. The company also said it is making progress with a strategic review of its Netspend consumer business.
HSBC (HSBC) is under pressure from its largest shareholder, China-based insurance company Ping An, to break itself up, according to a source familiar with the matter who spoke to Reuters. Ping An is said to have presented its breakup plan to the bank's board of directors.
China EV makers Li Auto (LI) and Nio (NIO) both reported a drop in April deliveries compared to a year ago, saying production took a hit from the resurgence of Covid in China. Rival Xpeng (XPEV), however, reported an increase in deliveries compared to April 2021. Li Auto fell 1.7% in the premarket while Nio lost 2%.