En­ergy, tech­nol­ogy stocks slip

Smaller com­pa­nies do poorly as dol­lar’s slump con­tin­ues

The Denver Post - - BUSINESS - By Mar­ley Jay

Losses for en­ergy and tech­nol­ogy com­pa­nies left most U.S. stocks lower on Thurs­day. Smaller com­pa­nies fared worse as the dol­lar re­mained at 15-month lows.

En­ergy com­pa­nies weak­ened as the price of oil turned lower, and tech­nol­ogy com­pa­nies de­clined as Ap­ple gave up a piece of its big gain from the day be­fore. In­vestors bought gov­ern­ment bonds af­ter some shaky eco­nomic news in the U.S. and the U.K. That sent bond yields down, which hurt fi­nan­cial com­pa­nies. In­dus­trial com­pa­nies like 3M did well, and so did large drug­mak­ers like Pfizer.

Small com­pa­nies, which surged in Novem­ber and De­cem­ber, have slumped this week. Firearms maker Sturm Ruger tum­bled Thurs­day af­ter it said sales fell in the se­cond quar­ter, and sport­ing goods com­pa­nies like Big 5 and Vista Out­door also sank. Smaller banks fared worse than larger ones.

Ju­lian Emanuel, an eq­uity strate­gist for UBS, said that as the dol­lar con­tin­ues to lose strength, in­vestors are sell­ing smaller and more do­mes­ti­cally-fo­cused com­pa­nies and buy­ing more in­ter­na­tional busi­nesses, as the weaker dol­lar will help their prof­its and sales out­side the U.S.

“Most peo­ple didn’t ex­pect the de­gree of dol­lar weak­ness that we’re see­ing,” he said. The ICE U.S. Dol­lar In­dex is down 9 per­cent this year and hasn’t been this low in about 15 months.

The Stan­dard & Poor’s 500 in­dex shed 5.41 points, or 0.2 per­cent, to 2,472.16. The Dow Jones in­dus­trial av­er­age notched its eighth gain in a row and added 9.86 points, or less than 0.1 per­cent, to 22,026.10. The Nas­daq com­pos­ite lost 22.30 points, or 0.4 per­cent, to 6,340.34. The Rus­sell 2000 in­dex of smaller com­pa­nies sank 7.67 points, or 0.5 per­cent, to 1,405.23 af­ter a sharp loss a day ago.

Near the close of trad­ing, stocks turned a bit lower af­ter the Wall Street Jour­nal re­ported that Spe­cial Coun­sel Robert Mueller has im­pan­eled a grand jury in his in­ves­ti­ga­tion of Rus­sia’s in­ter­fer­ence in the 2016 pres­i­den­tial elec­tion.

Com­pa­nies have re­ported strong sec­ondquar­ter re­sults lately as cor­po­rate earn­ings con­tinue to grow, But with stocks at record highs, the mar­ket hasn’t re­acted very much: the S&P 500 flat over the last two weeks.

Com­pa­nies that didn’t live up to in­vestors’ ex­pec­ta­tions took losses. Se­cu­rity soft­ware maker Sy­man­tec an­nounced dis­ap­point­ing first-quar­ter sales, and its fore­casts for the rest of the year weren’t as good as an­a­lysts had hoped. The com­pany also agreed to sell its web­site se­cu­rity busi­ness to DigiCert for $950 mil­lion in cash and a 30 per­cent stake in DigiCert. Sy­man­tec slid 64 cents, or 2.1 per­cent, to $30.27.

3D printer maker 3D Sys­tems plunged $3.62, or 21.3 per­cent, to $13.39 af­ter it fell short of Wall Street es­ti­mates in the se­cond quar­ter and cut its pro­jec­tions for the full year. Else­where, Ap­ple lost $1.57, or 1 per­cent, to $155.57 af­ter a big jump the day be­fore.

Oil prices turned lower. Bench­mark U.S. crude dipped 56 cents, or 1.1 per­cent, to $49.03 a bar­rel in New York. Brent crude, the in­ter­na­tional stan­dard, fell 35 cents to $52.01 a bar­rel in Lon­don.

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