4 Stocks and Industries That Moved the Market in May
May was a rough time in the stock market, but investors can learn a lot from last month's major themes. If we understand the forces that influenced stocks last month, then we can make informed predictions about where the market is going. Here are some of the top stocks and industries that moved the market last month, and they illustrate important trends moving forward.
Shares of Snap (NYSE: SNAP) dropped 50% in May. The social media stock started out poorly along with other growth stocks, but things tumbled far further after CEO Evan Spiegel sent a downbeat memo to employees about Snap's deteriorating outlook for the full year. Just a few weeks after the company reported disappointing first-quarter earnings, Spiegel warned employees that it was likely to miss its forecasts for revenue and earnings. With growth challenged, the company is pulling back on hiring plans. The reduced expectations were attributed to a poor macroeconomic environment.
Growth stocks are bearing the brunt of this year's market downturn. Not only are stocks reflecting declining corporate outlooks, but waning investor risk tolerance is driving valuations lower. This has a compounding effect that is hitting share prices for businesses like Snap. The stock's forward P/E (price to earnings) has fallen to 65, and its price-to-sales ratio is down to 5.2.
Source Fool.com
