WIKIFX REPORT: Wall Street closes in on third straight quarterly loss

Wall Street wobbled to the end of the S&P 500's steepest September decline since the global financial crisis on Friday, closing the books on a tumultuous quarter fraught with historically hot inflation, rising interest rates and recession fears.

All three major indexes were in the red, having fluctuated through much of the session.

The S&P and the Dow were on track to notch their third consecutive weekly declines, and all three indexes have set a course for their second straight monthly losses.

In the first nine months of 2022, Wall Street suffered three straight quarterly declines, the longest losing streak for the S&P and the Nasdaq since the Great Recession and the Dow's longest in seven years.

“It's been a very painful quarter for the stock market,” said Tim Ghriskey, senior portfolio strategist Ingalls & Snyder in New York. “There's uncertainty about the Fed and their ability to keep the economy moving along as they attack inflation and bring it down to a sustainable level.”

The Federal Reserve has rattled markets by engaging in its most relentless series of interest rate hikes in decades in order to rein in stubbornly high inflation, which has many market participants eyeing key economic data for signs of a looming recession.

The Commerce Department's personal consumption expenditures (PCE) report did little to assuage those fears, showing that while consumers continue to spend, the prices they are paying have accelerated, drifting further beyond the Fed's inflation target and all but ensuring the central bank's hawkish monetary policy will continue longer than investors had hoped.

Recession fears also echoed through dire warnings from Nike Inc NKE.N and cruise operator Carnival Corp CCL.N , both citing inflation-related margin pressures.

Shares of the companies dropped 11.9% and 21.3%, respectively.

The Dow Jones Industrial Average .DJI fell 213.52 points, or 0.73%, to 29,012.09; the S&P 500 .SPX lost 14.56 points, or 0.40%, to 3,625.91; and the Nasdaq Composite .IXIC dropped 19.19 points, or 0.18%, to 10,718.32.

Among the 11 major sectors of the S&P 500 utilities .SPLRCU and consumer staples .SPLRCS , both considered proxies for the bond market, suffered the largest percentage losses.

Apple Inc AAPL.O , Nike Inc, and Microsoft Corp MSFT.O were among the heaviest drags.

Corporate earnings reports for the quarter that ends with Friday's closing bell will begin landing in a few weeks, and analyst expectations are trending downward.

Analysts now see annual S&P 500 earnings growth of 4.5%, on aggregate, down from the 11.1% estimate when the quarter began.

Quarter-end fund reallocations and so-called “window dressing” is likely contributing to the session's volatility.

Advancing issues outnumbered declining ones on the NYSE by a 1.39-to-1 ratio; on Nasdaq, a 1.64-to-1 ratio favored advancers.

The S&P 500 posted no new 52-week highs and 55 new lows; the Nasdaq Composite recorded 15 new highs and 239 new lows.