Today’s Market Wrap Up and a Glimpse Into Friday

Inflation worries finally caught up with investors, triggering a sell-off on Wall Street. The S&P 500 shed nearly 1% in a stark reversal from Wednesday when the broader market index reached a new all-time high. Investors are starting to question the sustainability of the economic recovery due to too few workers for a surplus of jobs coupled with supply chain constraints.

The Dow Jones Industrial Average shed more than 250 points, while the Nasdaq was down over 100 points. No sector was left unscathed, from technology to the banks, though the three major indices closed off their worst levels of the day.

Stocks to Watch

Wells Fargo was trending on Twitter after revealing that it would shutter its personal lines of credit product, leaving consumers outraged. Not only will customers lose access to the product but the move could affect their credit scores.

Bank customers were previously able to access between USD 3K and USD 100K and tended to use the credit line for everything from consolidating credit card debt to home repairs to preventing overdraft fees. Wells Fargo is set to report its quarterly earnings on July 14.

Pfizer is seeking regulatory approval to increase the dose of its COVID-19 vaccine in an attempt to thwart the Delta variant that has been spreading. The pharmaceutical company is looking to do so in the next month and has approached the FDA for the green light. Pfizer is planning clinical trials next month.

Levi Strauss was more than 2% higher in after-hours trading after reporting its Q2 results.  The company’s earnings and revenue surpassed Wall Street estimates, with sales poised to revisit pre-COVID-19 levels in Q3. The apparel company raised its full-year outlook as long as the pandemic remains under control.

On the meme stock front, AMC Entertainment bounced back, adding 6% after four straight days of declines. GameStop similarly found its stride and avoided another day in the doldrums. The winner on the meme-stock front was Virgin Galactic, whose value ballooned by 17% to close above USD 52 per share ahead of Richard Branson’s upcoming spaceflight this weekend.

Economic Outlook

Wells Fargo economists have revised their second-quarter and full-year 2021 GDP forecasts lower. They now expect GDP to expand at 9.2% in Q2 and 7% for the year, down from previous forecasts of 10.9% for the quarter and 7.3% for 2021. The economists cited “softer than expected data performances at quarter’s end.”