Super Micro Computer shares took a tumble on Friday, plunging more than 18% as the server maker announced its third-quarter earnings date without giving preliminary results. Despite being added to the S&P 500 last month, Super Micro’s stock is still up 165% for the year, but has dropped more than 25% this quarter. This marks the steepest drop since February.
In contrast, regional banks have been a rare pocket of strength in the stock market this week. The S&P Composite 1500 Regional Banks Index has gained almost 1.4% this week, while the S&P 500 Financials Index is up almost 0.7%. Capital Economics chief markets economist John Higgins attributes this strength to higher Treasury yields, a resilient U.S. economy, and relatively low valuations.
On the other hand, Netflix is on pace to log its worst day in more than 2 years, with shares down 8.8% after the company shared a weaker full-year revenue growth outlook. Canaccord Genuity analyst Maria Ripps downgraded the stock to a hold rating, citing “limited growth catalysts” ahead.
The S&P 500 fell below the 5,000 level on Friday, marking the latest symbol of the recent market pullback. Tesla and Micron Technology are among the Nasdaq’s worst weekly performers, while American Express led the Dow higher with a post-earnings rally.
In other news, Needham upgraded Netflix to a buy rating, while Chicago Federal Reserve President Austan Goolsbee said the Fed’s current rate policy is “appropriate.” Goldman Sachs warned of increasing equity downside risks, and oil prices turned lower after reports of a carefully calibrated Israeli strike on Iran.
Overall, the stock market is heading for a losing week, with the three major indexes on track for notable losses. Defensive sectors like utilities and consumer staples have clung to weekly gains amid the market turmoil.
