Geoffrey Smith 

Investing.com — U.S. stock market opened lower Friday due to a Netflix warning about slowing subscriber Growth. This sent shockwaves through an already highly volatile tech sector.

At 9:45 am ET (1445 GMT), tech-heavy dropped another 151 point, or 1.1%. Meanwhile, the had fallen 0.6%. At 35,636 the Dow Jones Industrial average fell 80 points or 0.2%. 

For the Nasdaq, that represents a seven-month low, while the S&P and Dow are at three- and two-month lows, respectively.

Netflix stock fell nearly 25% this morning after the streaming giant predicted it would add only 2.5 million global subscribers to its current quarter. The streaming giant’s previous estimates and the pace at which subs were added before the pandemic are both well below it. This suggests that Netflix is no longer enjoying the streaming boom. 

Netflix is a tech stock that has seen the heat. However, it does have some profits. Netflix’s $1.33 per share earnings were well ahead of expectations. They still exited stock trading at 45x trailing 12-month earnings as of Thursday’s closing, which is a very high ratio considering the company appears to have increasing market saturation and increased competition.

Netflix joins the expanding ranks of companies whose gains from pandemic-era events have been almost completely undone. Since April 2020 when streaming was seen as one of the largest beneficiaries of pandemic-driven shifts in consumer behaviour, the stock has not traded so low since. 

These behavior patterns have – in large part – begun to return to normal. Reports on Thursday of a production halt at Peloton Interactive (NASDAQ:) to clear unsold inventory also sent Peloton stock down by a quarter. The company clarified that the stock recovered 5.0% in Friday’s early trading, pointing to cost cutting and a resizing its ambitions.

Intel (NASDAQ) had better news. It announced that it would build the $20 billion first stage of a multi-plant facility at Ohio. This move will reduce supply chain bottlenecks and help eliminate them. Intel stock gained 2.0% due to the confidence it displayed in this decision.

Schlumberger (NYSE) stock succumbed to profit-taking despite it beating all expectations in its fourth quarter earnings. Schlumberger also forecasts a “substantial increase” in capital spending by oil and natural gas companies for this year. This is due to high oil prices rebalancing the sector’s risk/reward outlook. Schlumberger stock dropped 2.0% in the fourth quarter, however it has increased more than 20% over the previous year.

Although prices are still close to their seven-year peak, they have fallen in the last 24hrs after new data showed that U.S. gasoline inventories continued to climb for a third week straight. These data along with the Thursday jobless claims data suggest that the economy is experiencing a slight softening because of the Omicron variant Covid-19. The majority of analysts believe that the impact will be temporary. Europe is where the variant first arrived. France, Ireland, and the U.K. are loosening their social distancing rules, while most countries feel that the infection rate has risen.