CE 100 Index Sinks 2.3% as BNPL Names Trend Lower

Friday’s stock market rout — where markets plummeted in the wake of a surprisingly strong jobs report that splashed cold water on interest rate cuts from the Fed — added to the CE 100 Index’s downward momentum of this past week.

The overall index slipped 2.3% and now stands in negative territory for the year. Two of the 11 pillars we tracked — the Be Well and the Communicate group — gained scant ground. Those segments were up less than 1% each.

Banking names will kick off earnings season this week — and stocks in the segment fell to earth, at least a bit, giving back some of trailing 12-month gains that are still lofty, north of 30%. We’ll get a sense of how consumer and commercial credit is faring, along with data on how loan performance has impacted banks’ balance sheets. As a segment, banks gave up 4% through the past five trading days.

The macro impact of interest rates also may have had an impact on the Pay and Be Paid segment, which led to the downside, sliding 6.2%.

Double-Digit Losses in BNPL Names

Buy now, pay later (BNPL) names slipped here, as Sezzle gave up 17.9% through the week, and Affirm lost 16.8%.

Sezzle continued to bear the brunt of negative stock performance after short sellers’ reports from the likes of Hindenburg and Bear Cave questioned the company’s business practices. In reference to the latter’s allegations, the Bear Cave has contended that the company has realized profits and growth from fraudulent practices.

The specter of relatively higher interest rates may be leading various lending platforms lower in the markets, as consumers would presumably be hesitant to take on more debt and spur delinquencies. Block shares declined more than 10%.

Visa shares slipped 2.3%. In an announcement, Visa and spend management solution provider Qashio have partnered to launch a B2B travel payments solution in the United Arab Emirates (UAE), the Middle East and North Africa region, Europe and the United Kingdom.

Their launch of the Visa Commercial Choice Travel program in these areas will transform and digitize payments for online travel agencies and travel management companies, the companies said. With this collaboration, travel companies will be able to obtain Qashio cards and transact in several currencies, including UAE dirhams, Saudi riyals, U.S. dollars, euros and British pound sterling.

In Amazon related news, as the Enablers group was 2.9% lower, and company shares lost 2.3%, the eCommerce behemoth said it will shut down its “Prime Try Before You Buy” service at the end of this month, according to a notice on the company’s website.  Amazon launched the service in 2017, allowing Prime members to order clothing, try it on and decide whether to keep it before being charged for it. After the service is wound down, Prime members will still be able to order clothing, make normal returns and receive a refund, according to reports.

The above names swamped the gains seen from the likes of Delta, which saw its shares soar by 13.5%. The company reported earnings this past week that showed strong travel demand, especially commercial travel, headed into the year’s final months.  International passenger revenue growth was up 6% year over year, and corporate sales were up by double digits. Operating revenues of $15.6 billion were 9% higher than a year ago.