Meta trades at pre-pandemic levels, Apple down 9.6% for the month

Yahoo Finance's Ines Ferré and Jared Blikre break down how markets are trading into the close of the third quarter, particularly with recent moves in the tech sector, consumer discretionary sector, and the U.S. dollar.

Video transcript

AKIKO FUJITA: For a deeper dive on the market action, let's bring in Yahoo Finance's Ines Ferre and Jared Blikre. And guys, we were watching the core PCE today, essentially, what is the Fed's preferred measure here, that came in a little stronger than expected, 0.6% when you look at quarter on quarter, about 5% year on year. But here we are at the end of what has been a very volatile month, looking at some green on the board, Ines.

INES FERRE: Yeah, that's right. So just taking a look at where we're at with the sectors, as we end the quarter, as we end the month, I'm pulling up our YFi Interactive Board here, and you can see that consumer discretionary for the quarter, actually, gained. You've got real estate and communications services that have lost the most. But it's the month to date that I like to look at because it's really the one that also is in investor psychology, right, what has happened over this last month.

And you can see here, again, real estate, utilities, tech, and communications services. And as I pull up the NASDAQ 100 chart, you can see a month to date here. And I like to point out a couple of stocks here. There's a lot to point out. But let's start with Meta because Meta is down 14% month to date. But I just want to pull up a five-year chart so you can see the price action here. We are trading at levels that Meta hasn't seen since pre-pandemic levels, since 2020, I should say, and even 2019.

So the pandemic gains that Meta had gained are over. And you could say that it's partly because of their strategy of pivoting into Meta, also, of course, advertising woes. The other one that I want to point out is Apple, and I'm just going to pull up a month to date chart for Apple, down 9.6%. And I like to look at Apple because it really is an investor favorite, a retail trade favorite, and also a bellwether, really, for the economy.

Now, if you take a look at a year to date, it is down almost 20%. But that month to date, this level right here, 142, because investors had been taking a look at 150. I remember Jared was speaking to a technical analyst not that long ago, talking about the line in the sand being 150 and Apple breaking through that.

AKIKO FUJITA: And Jared, you're watching currencies--

JARED BLIKRE: I--

AKIKO FUJITA: --which is also something that we have-- I feel like we've been talking about it every day. This has really been driving some of the concern.

JARED BLIKRE: Yes, it has. And we've been talking about it every day because it has been a big huge driver of the market, probably one of the biggest that I see. I'm going to wrestle control over the YFi Interactive here and get to some of our currency heatmaps. And first up, I do have the US dollar versus everything else. So let's take a look at what's going on month to date here. And we can see a lot of commodity-based currencies, also emerging market currencies at the top.

And I'll go through these. USDNOK, that is the Norwegian Krone. The US dollar has appreciated 9% versus this instrument here. Then we have the Argentine peso-- that is ARS. And we have the Australian dollars. Then we have South African Rand, Canadian dollar, BRL-- that's Brazil. Then we got Sweden. Then we got Great Britain. Then we got Japan. Then we got China. So as you can see, it's a broad mix of not only developing markets, but also developed.

And you want to take a look at some of the interventions or some of the surprises that we've had this month. It started last week before the Fed announced. The surprise was coming from Sweden that they hiked 100 basis points instead of 75. All right, that really did nothing to stem the tide out of the krona there and into the US dollar. Also the British pound.

Now, as we know, they have basically reversed their policy. They have engaged in bond buying to support their pension system. We can see the pound has lost about 20% or so to the dollar. The dollar has gained about that amount. And then also, finally, the yen. Now the BOJ has intervened a little bit. And they have used some of their $1.3 trillion in Foreign Reserve holdings of the US dollar to try and prop up the yen.

But I was reading a B of A note today. And this is all smacks of desperation. These are some ad hoc responses to existing ploys to basically stabilize things in the short-term, not the long-term. And so in this note, Michael Hartnett in company basically saying that we're going to need more fallout from this before we get an eventual bottom. You look to the S&P 500-- 3,300 a big level, 3,000 a big level. Suffice to say, those are beneath-- well beneath current prices.

AKIKO FUJITA: Yeah, you talked about the intervention from the BOJ I know the day that came down. We were saying, look, there's not a whole lot the BOJ can do when it really is about the dollar. We've had a number of guests on the last few days talking about the dollar strength, really staying here or here to stay for, at least, the medium-term, at least according to them. I mean, what are you hearing on that front?

JARED BLIKRE: I'll tell you what. The greatest-- the best news that I've seen versus the US dollar is, in fact-- I'm going to pull up this tweet that I just tweeted out a couple of minutes ago. And this has to do with contrarian indicators. So which is more bearish for the US dollar? It involves a little AI work here. Raccoons stealing the Fed's gold from 33 Liberty or Businessweek cover featuring the greenback wrecking ball? And here's some of these adorable AI generated images of raccoons stealing gold from the Fed.

But this is the one I've been focusing on. This is going to hit people's mailboxes over the weekend. Can't stop, won't stop. This is the US dollar, quote, "wrecking ball." And that comes from Federal Reserve officials. So a lot of times, it takes weeks, if not a month or two, to put these covers together. And so by the time these eventually hit the newsstands, a lot of times, the move is over. So, potentially, if we get a break in the US dollar here, we could see a rise in risk assets. But I think it's only going to be temporary, probably more fallout to come.

AKIKO FUJITA: Yeah, expect to hear a lot more commentary from companies moving forward as well.

INES FERRE: And I'll tell you something else that the US dollar is also impacting, and you can pull up the YFi Interactive on this one. And that is commodities. And when you take a look at oil prices, you've got oil, WTI set for its first quarterly loss since 2020, with WTI down 22% quarter to date. So, again, these fears of a recession and the strong dollar impacting energy.

AKIKO FUJITA: OK, certainly a lot to think about as we go into the next quarter. Thanks so much, Ines and Jared.