Houston Chronicle

A mixed bag of corporate earnings nudges U.S. stocks slightly lower.

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A mixed bag of corporate earnings nudged U.S. stocks slightly lower Wednesday, snapping the market’s fiveday winning streak.

Communicat­ions sector stocks, led by steep declines in video game companies, accounted for most of the market’s slide. TakeTwo Interactiv­e and Electronic Arts plunged after reporting earnings that fell far short of what Wall Street analysts were expecting. The companies also issued weak forecasts, citing tougher competitio­n.

Gains in technology stocks offset some of those losses, with Skyworks Solutions leading a rally in semiconduc­tor companies.

“This is an earnings-driven market, and where you’ve seen both positive and negative price movement today it has largely been sector and industry specific,” said Paul Springmeye­r, head of investment­s at U.S. Bank Wealth Management. “On balance, sales and earnings are really trending mostly above expectatio­ns.”

The Dow Jones Industrial Average fell 21.22 points, or 0.1 percent, to 25,390.30. The S&P 500 index dropped 6.09 points, or 0.2 percent, to 2,731.61. The benchmark index finished higher the previous five days in a row.

The Nasdaq composite slid 26.80 points, or 0.4 percent, to 7,375.28. The Russell 2000 index of smaller companies gave up 2.20 points, or 0.1 percent, to 1,518.02. Major European indexes also finished lower.

More than half of the companies in the S&P 500 have already reported results for the last three months of 2018, and most have turned in earnings that beat analysts’ forecasts.

“What we are seeing is earnings are in fact slowing, but they still remain positive,” Springmeye­r said.

That’s helped to allay some investors’ fears over a slowdown in growth. Still, broader economic concerns continue to shadow the market, including uncertaint­y over the U.S.-China trade dispute, the impact tariffs are having on profits and consumers’ wallets, and signs of a general slowdown in global growth.

The latest quarterly snapshots from video game companies failed to impress traders Wednesday.

Take-Two, maker of the “Grand Theft Auto” and “Red Dead Redemption” games series, gave investors a weak outlook for the current quarter. Electronic Arts, whose titles include “The Sims” and various sports games, including “Madden NFL,” flagged disappoint­ing results in sales of its latest “Battlefiel­d” game.

Both companies are grappling with competitio­n from Epic Games Inc.’s hit game “Fortnite.”

Traders bid up shares in several companies that reported improved quarterly results.

The company behind the popular photo-messaging app SnapChat surged 22 percent as advertisin­g gains drove revenue growth in the fourth quarter. The revenue increase helped cut the company’s losses. It also maintained its user base.

The New York Times vaulted 10.3 percent in heavy trading after the newspaper publisher touted a big gain in digital subscriber­s and digital revenue for the October-December quarter. The Times added 265,000 digital subscripti­ons in the fourth quarter. Its earnings and revenue topped Wall Street’s forecasts.

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