US equity markets logged a second consecutive session of steep losses in the wake of last Friday’s (10 June) blistering inflation report, with the benchmark indices touching their session lows in the closing 30-minutes of trading after the a Wall Street Journal report suggested the Federal Reserve would consider raising rates by +75 basis points at the conclusion of their two day monetary policy meeting later this week - Dow tumbled -876-points or -2.79%, dropping as much as -1,019 points at one point in the session. Boeing Co (down -8.77%), Salesforce Inc (-6.96%) and American Express Co (-5.26%) were among the major drags on the Dow. The broader S&P500 shed -3.88% to 3,749.63, the lowest close since March 2021. Only five index constituents closed the session in the positive territory. The index settled over >21% below the 3 January record close (3837.248) and entered official bear market territory. The last time the S&P500 was in a bear market was in March 2020 at the onset of the pandemic. Energy (down -5.13%) led all eleven primary sectors lower, with all sectors declining over >2%. Travel stocks declined despite the Biden administration announced that it will drop the COVID-19 testing requirement for inbound air travellers from abroad from Sunday (12 June), ending one of the longest-running travel restrictions of the pandemic. United Airlines Holdings Inc fell -10.06% and Delta Air Lines Inc -8.29%, while cruise operators Carnival Corporation and Norwegian Cruise Line Holdings fell -10.32% and -12.23% respectively. The Nasdaq slumped -4.68%, extending losses for the technology-centric index during this current sell-off to more than >33%. Netflix Inc (down -7.24%), Nvidia Corp (-7.82%) and Tesla Inc (-7.10%) all fell over >7%. Tesla proposed a 3-for-1 stock split in its proxy statement filed after the closing bell last Friday (10 June), saying it would provide more flexibility for its employees managing their equity and serve as a recruiting tool. The split would be Tesla’s second in as many years, with the electric vehicle maker undertaking a 5-for-1 stock split in August 2020. Tesla is slated to hold its annual shareholder meeting on 4 August. Elsewhere, Goldman Sachs downgraded Netflix last Friday (10 June) to a “Sell” from “Neutral” and cut its price target to US$186 from US$265, citing “concerns around the impact of a consumer recession as well as heightened levels of competition on demand trends”. The small capitalisation Russell 2000 slumped -4.76%.
