Investors are pulling their money out of equities at a blistering rate — last week, they removed $10.6 billion from U.S. domestic stock funds, more than they had in the prior two weeks combined, Barrons.com’s Brendan Conway reported earlier this week.
And maybe they were on to something.
Because the week that just past was the worst for the major indexes in four months. The Dow fell 281 points or 2.1% to 13,329. The S&P 500 fell 32.3 points, or 2.2%, to 1,428.6. It was the worst week for both indexes since the week that ended June 1.
Stocks came into the week following a mixed-to-positive jobs report the previous Friday. But this week investors were bound to get a wake-up call: earnings season unofficially began on Tuesday with Alcoa’s (AA) third quarter report.
While some companies beat expectations, a lower demand forecast from Alcoa and a warning from Chevron (CVX) put a damper on stocks. And JPMorgan Chase (JPM) and Wells Fargo (WFC) both beat EPS expectations, investors were less excited about the details of the reports. Both stocks fell on Friday.
As earnings season picks up next week, could the market’s slide accelerate?
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