Nas­daq ad­vances; S&P 500, Dow re­treat on earn­ings

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The S&P 500 and Dow closed lower and the Nas­daq ad­vanced on Wed­nes­day as in­vestors di­gested the lat­est round of earn­ings, while a drop in oil prices weighed on the en­ergy sec­tor. IBM sank 4.9% to $161.69 af­ter the com­pany re­ported a big­ger-than-ex­pected de­cline in rev­enue for the first time in five quar­ters. The stock was the big­gest drag on the S&P and the price-weighted Dow. “Usu­ally, the big­ger names are the bell­wethers. Peo­ple look to them for some sig­nals on the over­all health, and some­times the com­pa­nies that re­port later that beat are lost in that shuf­fle,” said Peter Jankovskis, co-chief in­vest­ment of­fi­cer at OakBrook In­vest­ments LLC in Lisle, Illi­nois. The en­ergy sec­tor slumped 1.4% for its fifth drop in six ses­sions as oil prices set­tled nearly four per­cent lower.

NEW YORK— The S&P 500 and Dow closed lower and the Nas­daq ad­vanced on Wed­nes­day as in­vestors di­gested the lat­est round of earn­ings, while a drop in oil prices weighed on the en­ergy sec­tor.

IBM sank 4.90% to $ 161.69 af­ter the com­pany re­ported a big­ger- than- ex­pected de­cline in rev­enue for the first time in five quar­ters. The stock was the big­gest drag on the S&P and the price-weighted Dow.

“Usu­ally, the big­ger names are the bell­wethers. Peo­ple look to them for some sig­nals on the over­all health, and some­times the com­pa­nies that re­port later that beat are lost in that shuf­fle,” said Peter Jankovskis, co-chief in­vest­ment of­fi­cer at OakBrook In­vest­ments LLC in Lisle, Illi­nois.

The en­ergy sec­tor slumped 1.40% for its fifth drop in six ses­sions as oil prices set­tled nearly 4% lower.

US data showed a counter-sea­sonal build in gaso­line in­ven­to­ries and a smaller-than-ex­pected de­cline in over­all crude stocks and sent US crude be­low the $52 a bar­rel mark for the first time in two weeks.

“Cer­tainly oil has been weak­en­ing for a cou­ple of days and that has been putting some pres­sure on things,” said Mr. Jankovskis.

Mor­gan Stan­ley rose 2% af­ter post­ing a surge in quar­terly profit, tak­ing some of the sting out of a dis­ap­point­ing re­port from Goldman Sachs on Tues­day.

Of the 57 com­pa­nies in the S&P 500 that have re­ported earn­ings through Wed­nes­day morn­ing, 75.40% have topped ex­pec­ta­tions, ac­cord­ing to Thom­son Reuters data, above the 71% av­er­age for the past four quar­ters.

Over­all, prof­its of S& P 500 com­pa­nies are es­ti­mated to have risen 10.80% in the quar­ter — the best since 2011.

The Dow Jones In­dus­trial Av­er­age fell 118.79 points, or 0.58%, to 20,404.49, the S& P 500 lost 4.03 points, or 0.17%, to 2,338.16 and the Nas­daq Com­pos­ite added 13.56 points, or 0.23%, to 5,863.03.

The S&P 500 failed to climb above its 50-day mov­ing av­er­age, a level which has acted as re­sis­tance since the bench­mark in­dex fell be­low it last week.

With Wall Street near record lev­els and wor­ries over Pres­i­dent Don­ald Trump’s abil­ity to carry out his pro-growth prom­ises, in­vestors are hop­ing first-quar­ter earn­ings will be strong enough to jus­tify pricey mar­ket val­u­a­tions.

Mount­ing ten­sion be­tween North Korea and the United States, along with po­lit­i­cal un­cer­tainty in Europe ahead of the French pres­i­den­tial elec­tions, have also kept in­vestors cau­tious.

In­tu­itive Sur­gi­cal gained 6.40% at $ 807.94 to help lift the Nas­daq af­ter the com­pany re­ported higher- than- ex­pected first-quar­ter rev­enue and profit.

The US econ­omy ex­panded at a mod­est- to- mod­er­ate pace be­tween mid- Fe­bru­ary and the end of March, but in­fla­tion pres­sures re­mained in check de­spite more dif­fi­cul­ties in at­tract­ing and re­tain­ing work­ers, the Fed­eral Re­serve said.

De­clin­ing is­sues out­num­bered ad­vanc­ing ones on the NYSE by a 1.12-to-1 ra­tio; on Nas­daq, a 1.52to-1 ra­tio fa­vored ad­vancers. The S&P 500 posted 21 new 52-week highs and three new lows; the Nas­daq Com­pos­ite recorded 80 new highs and 39 new lows.

About 6.60 bil­lion shares changed hands in US ex­changes, above the 6.31 bil­lion daily av­er­age over the last 20 ses­sions. —

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