Friday stocks sag following disappointing profit reports

Associated Press

NEW YORK — Stock markets around the world sagged Friday after Amazon and other big companies reported quarterly results that underwhelmed investors.

The Standard & Poor’s 500 index lost 3.32 points, or 0.1 percent, falling to 2,472.10 and closed a week packed with corporate earnings reports almost exactly where it started. It set a record during the middle of it.

The Dow Jones industrial average gained 33.76 points, or 0.2 percent, to 21,830.31 and set another all-time high. The Nasdaq composite fell 7.51, or 0.1 percent, to 6,374.68.

A little more than half the companies in the S&P 500 have now shown how much profit they made during the spring, and the results have been mostly encouraging. Earnings for the index are on pace to be about 9 percent higher than a year earlier, according to FactSet. But expectations were high coming into the reporting season, and the few companies that have fallen short of forecasts have seen their stock prices punished.

Amazon dropped $25.96, or 2.5 percent, to $1,020.04 after its profit missed expectations. Its forecast for operating income this fiscal year was also below many analysts’ forecasts, though revenue for the latest quarter beat expectations.

Earnings reports were the main focus for markets during a busy week, where the Federal Reserve also decided Wednesday to hold interest rates steady and the government Friday gave an update on the economy’s health.

The economy grew at an annual rate of 2.6 percent in the second quarter, revved up by a rise in consumer spending, the Commerce Department reported.

“Overall, the economy continues to move along, but it’s hard to see where the fuel is going to come from for further acceleration,” said Rich Weiss, chief investment officer of multi-asset strategies at American Century Investments. He said the economy reminds him of what golfers call a “son-in-law” shot, one that’s not bad but not great.