Stocks sink again as CEOs sound alarm bells about economy
By Paul R. La Monica, CNN Business
Some top CEOs appear to be worried that the economy could be the Grinch that steals Christmas this year. And investors are not pleased.
Stocks sank Tuesday, the second straight day of losses on Wall Street. The Dow fell more than 350 points, or 1.3%. That follows a nearly 500-point slide Monday. The S&P 500 and Nasdaq were down 1.4% and 2% respectively.
Four of America’s leading chief executives gave cautious comments about the economy in interviews Tuesday, and that seems to have spooked the market.
Walmart CEO Doug McMillon told CNBC that lower-end consumers were still feeling the pinch from inflation. And JPMorgan Chase CEO Jamie Dimon said on CNBC he thought there could be a “mild to hard recession” due to the Federal Reserve’s continued interest rate hikes. (Dimon also bashed crypto again, comparing tokens to “pet rocks.”)
Goldman Sachs CEO David Solomon also sounded recession alarm bells, telling Bloomberg Tuesday that “you have to assume that we have some bumpy times ahead” and warned that smaller bonuses and possible job cuts were likely at the investment bank.
And Lance Fritz, the CEO of railroad giant Union Pacific, added in a CNBC appearance that “clearly the consumer side of the economy is slowing.” The stock ended the day unchanged.
Shares of JPMorgan Chase, Walmart and Goldman Sachs, which are all Dow components, were flat and down 1.2% and 2.4% respectively. Boeing and Disney were the biggest Dow losers.
UnitedHealth and Travelers were Dow leaders and just two of six components to finish the day higher.
Investors are also growing anxious about next week’s Federal Reserve meeting.
The Fed is certain to raise interest rates again on December 14, but it is not clear if the central bank will do so by just a half point or if it will boost rates by three-quarters of a point for the fifth straight time. Continued strength in the jobs market has some worried that inflation is still not yet under control.
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