Dow Plummets as Nike Declines

U.S. stocks fell Friday following the release of the Federal Reserve’s latest bank stress-test results and disappointing quarterly numbers out of Nike.

The Dow Jones Industrials plummeted 255.81 points, or 1%, to open Friday at 25,504.16.

The S&P 500 doffed 20.54 points to 3,063.22.

The NASDAQ Composite slouched 65.58 points to 9,949.48.

The moves came after the Fed’s annual stress test of the major banks showed some banks could get close to minimum capital levels in scenarios related to the coronavirus pandemic. Because of this, banks must suspend share repurchase programs and keep dividend payments at current levels for the third quarter.

Nike shares slid 3.6% on the back of a surprising quarterly loss for the apparel giant. The company reported a loss of 51 cents per share and revenue of $6.31 billion for its fiscal fourth quarter. Nike’s quarterly revenue reflected a drop of 38% on a year-over-year basis.

The losses Friday morning came despite a record rise in consumer spending in May. The Commerce Department reported Friday that spending increased 8.2% last month, a positive sign for the U.S. economy amid a growing number of negative coronavirus headlines.

The government’s report on how much Americans spent on goods and services in May was the largest one-month gain dating back to records beginning in 1959. Consumer spending represents more than two-thirds of economic demand in the U.S.

Florida reported just over 5,000 additional cases. Arizona’s cases jumped by 5.1%, topping a seven-day average of 2.3%. Texas Gov. Greg Abbott said the state would pause its reopening plans given the recent spike in cases and hospitalizations.

Prices for the 10-Year Treasury gained back lost ground, lowering yields to 0.66% from Thurssday’s 0.69%. Treasury prices and yields move in opposite directions.

Oil prices dipped 14 cents to $38.58 U.S. a barrel.

Gold prices shuttled lower $8.60 to $1,762.00 U.S. an ounce.