The New York Stock Exchange ended divided on Wednesday, the Dow Jones being supported by good results from companies while technology stocks were weighed down by the collapse of the Netflix streaming group.
According to final results at the close, the Dow Jones index advanced 0.71% to 35,160.79 points. The Nasdaq, with strong technological coloring, dropped 1.22% to 13,453.07 points and the S&P 500, positive for most of the session, concluded below the balance at 4,459.45 points (-0, 06%).
“The big story of the day was Netflix,” summed up Art Hogan of National Securities. “It was a day centered around corporate results and Netflix absorbed all the oxygen of the session,” commented the analyst.
The title of the pioneer of streaming crashed spectacularly on Wednesday, losing 35.12% to 226.19 dollars, unheard of for ten years, the valuation of the American giant melting by 50 billion dollars, according to the tool. financial analysis Factset.
Netflix surprised investors on Tuesday by announcing post-market decline in first quarter earnings, and especially the loss of 200,000 subscribers while the streaming pioneer hoped to gain 2.5 million.
This is the first time in ten years that the group has lost subscribers and also the first time that the stock has fallen in such proportion.
This dragged down other entertainment groups like Disney (-5.55%), Roku (-6.17%) and Warner Bros. Discovery (-6.04%).
Netflix blamed the erosion of its customer base in the past quarter on the suspension of its service in Russia following Moscow’s invasion of Ukraine.
The group also suffered from the backlash of the upturn in subscriptions caused by the confinements linked to COVID-19. This influx of subscribers dried up with the resumption of activity.
In addition, the fierce competition that has flourished in streaming and inflation have weighed on the performance of the group, which is now considering using advertising funding.
Tesla on the rise
The Dow Jones, on the other hand, was supported, before losing momentum before the close, by good results announced by index heavyweights like Procter & Gamble (+2.45% to 163 dollars).
The manufacturer of Gillette razors and Pampers nappies announced on Wednesday a strong increase in quarterly sales and better than expected thanks to the rise in prices of the products that the manufacturer markets.
IBM, another member of the blue chip index, climbed 7.10% to $138.32 having reported quarterly profit above expectations on Tuesday after the close, thanks in part to more activity in its cloud offering ( remote computing).
Among the indicators, sales of existing homes fell in March in the United States, for the second month in a row, buyers being penalized by inflation to which is now added the rise in interest rates, while housing prices continue to rise.
According to the National Federation of American Realtors (NAR), home resales fell 2.7% from February and 4.5% from March 2021.
The median price of a home reached $375,300, a record and 15% more than the same time last year.
On a positive note for equities, bond rates eased, with yields on 10-year US Treasury bills slipping to 2.84% from 2.93% the day before.
Paypal action stood out by falling 8.45% to 94.90 dollars, close to its lowest level in a year, following a downgrade by analysts.
Tesla was up almost 5% in post-trade electronic trading, after losing almost as much in session. The electric vehicle manufacturer announced after the close that it posted a profit of $ 3.3 billion in the 1st quarter, more than expected.