Shares on Wallstreet fell at market close on Wednesday with the Dow Jones Index, which measures top 30 largest US companies falling by more than 600 points after the country’s Federal Reserve said it had decided to retain its interest rates at the targeted range of 0.00-0.25%.
Jerome Powell, the chair of the Fed noted that the US economy is still far away from full recovery given the damage caused by the global pandemic.
“The path of the economy will depend significantly on the course of the virus, including progress on vaccinations. The ongoing public health crisis continues to weigh on economic activity, employment, and inflation and poses considerable risks to the economic outlook.” The Fed noted in its monetary policy statement.
At market close, the Dow Jones was down by 2.05% to close at its lowest since January 4 while the S&P 500 fell by as much as 2.56%. On the other hand, the Nasdaq 100 closed 2.80% lower.
Tech giant Apple Inc. released its financial results on Wednesday with revenue growing by 21% to $111.44 billion. The company said international sales contributed 64% of its total revenues.
Net income for the last quarter was up 29% to $28.75 billion while operating income year on year was up 31% to $33.53 billion. iPhone sales rose by 17% during the fourth quarter to $65.6 billion.
Electric vehicle and clean energy company Tesla Inc. released its fourth-quarter earnings report with revenue surging 46% to $10.74 billion. It said this was mainly driven by the nearly half a million vehicles that were produced and delivered in 2020.
Operating income for the period grew by 157% to $270 million.
Tesla’s shares fell by 5.07% in the after-hours trading, prompted by lower-than-expected earnings per share of 80 cents vs. $1.01 expected and 43 cents year-over-year.
Facebook Inc. has released its financials with total revenue for the year 2020 rising by 22% to $85.97 billion while net income was up 58% annually to hit $29.15 billion.
During the fourth quarter of 2020, net income surged 53% to $11.22 billion as diluted earnings per share rose 57% to $10.09 compared to 2019.
It said it had 1.84 billion daily active users on average for the month of December, a growth of 11% compared to the previous year. The number of monthly active users rose 12% to 2.8 billion as of December 31, 2020.
South Korean tech firm Samsung Electronics has reported its financials with total sales up marginally by 2.8% to $212.52 billion. Operating profit for the fourth quarter of 2020 declined by 27% to $8.12 billion and on a year on year basis, the operating profit was up 26.4%.
Net profit for the year rose to $23.7 billion from $19.50 billion reported in 2019.
Shares GameStop, an American video game, consumer electronics, and gaming merchandise retailer continued to rise on Wednesday mainly driven by retail traders of a Reddit message board called WallStreetBets where participants discuss stock and options trading.
On Wednesday, the shares rose by 107.63% following Elon Musk’s mention of the company on Twitter on Tuesday.
“Our economic team, including secretary Yellen, are monitoring the situation. It’s a good reminder though that the stock market isn’t the only measure of the health of our economy.” White House Press Secretary Jen Psaki said when asked about the events on Wallstreet.
GameStop stock price has soared more than 1,700% this month.
Meanwhile, Bloomberg reported that professional hedge funds, Melvin Capital and Citron Capital closed have out of their short positions on GameStop Corp after being squeezed by the army of retail traders. Melvin Capital closed its position after repositioning its portfolio, according to a spokesperson. Citron Capital’s Andrew Left also said Wednesday that the firm covered the majority of its GameStop short bets at “a loss of 100%” in a YouTube video.