Following a challenging start to today’s market activity, indices fought back to losses within a half of 1% by mid-day, with the small-cap Russell 2000 ascending into the green for a time today. Then, following comments from renowned Fed hawk James Bullard, in which he “wouldn’t rule out” a 50 bps interest hike at the Fed’s next meeting, all four major market indices headed for session lows. The Dow closed -431 points, -1.26%, the S&P 500 -1.38%, Nasdaq -214 points or -1.78% and the Russell -0.96%.

St Louis Fed President Bullard was the second Fed member in as many days to bandy about a 50 bps interest rate increase at the next Federal Open Market Committee (FOMC) meeting on the 21st and 22nd of next month. Cleveland President Loretta Mester yesterday mentioned she would have voted for a 50 bps hike at the February 1st meeting. A 50 bps increase would take the Fed funds range to between 5.00-5.25% — the highest level since September 2007, where it had been for more than a year. It should be noted, however, that neither Bullard nor Mester are currently voting Fed members.

Today’s sell-off brings us to flat levels for the week. Remember, just yesterday we were running hotter on strong consumer data, but today we saw a Producer Price Index (PPI) for last month that was much hotter, as well. So again it looks as if the inflation alarm clock has gone off for market participants, although we do appear to be trading within a range at present. Although this is the worst trading day in almost exactly a month, we’re mostly seeing a dialing back of overall risk appetite. Nobody likes a losing day, but it looks more simply like yesterday’s bull fever has broken for now — not the end of the world.

After today’s closing bell, Applied Materials AMAT is out with fiscal Q1 earnings results: earnings of $2.03 per share outperformed the Zacks consensus buy a solid dime on $6.74 billion in quarterly sales, ahead of the $6.69 billion expected. Current quarter revenue guidance has been raised to $6.4 billion; analysts had been expecting $6.12 billion. The company did announce a one-time charge in the coming quarter of $250 million, likely based on a cybersecurity event at one of its major business clients. Shares are +1% in after-hours trading, +19% year to date.

DoorDash DASH surged higher in late trading following its Q4 earnings report this afternoon: a bigger-than-expected loss to -$1.65 per share was hit by an impairment charge (probably due to its investment in Flick), but was offset by revenues reaching $1.82 billion in the quarter, above the $1.77 billion anticipated. Full-year adjusted EBITDA guided higher, and the stock initially was +13% on the news; it has since retreated back to +4.5%.

DraftKings DKNG shares are also up nicely after releasing its Q4 earnings after the closing bell: bottom line of -53 cents outperformed the -63 cents expected, on a big revenue beat, to $855 billion from $797.5 billion in the Zacks consensus. Strong customer retention in the quarter, along with increased revenue guidance for full-year 2023, have helped shares drive +6.7% in today’s after-market.

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