Poor earnings reports send stocks lower
U.S. stocks closed slightly lower Wednesday, making up much of the ground they lost earlier following a rare batch of earnings disappointments by Walt Disney and other big companies.
Consumer-focused stocks, media companies and banks accounted for much of the market decline. They outweighed gains in health care stocks and elsewhere. Small-company stocks fell more than the rest of the market.
Investors’ unease over escalating tensions between the U.S. and North Korea had weighed on stocks earlier in the day, pushing gold and bond prices slightly higher. But by the end of the day, traders appeared to take the drama in stride.
“Right now the market is viewing it as a lot of saber-rattling and a lot of smoke, but not much fire,” said Darrell Cronk, president of Wells Fargo Investment Institute.
The Standard & Poor’s 500 index slipped 0.90 points, or 0.04 percent, to 2,474.02. The Dow Jones industrial average slid 36.64 points, or 0.2 percent, to 22,048.70. Earlier, the average had been down more than 88 points. The Nasdaq composite lost 18.13 points, or 0.3 percent, to 6,352.33. The Russell 2000 index of smaller-company stocks gave up 13.20 points, or 0.9 percent, to 1,396.95. That’s the index’s lowest level in two months.
Outside of geopolitical concerns, disappointing company earnings and outlooks put traders in a selling mood.
Priceline Group slid 6.9 percent after the online travel booking service issued a profit forecast that was weaker than analysts were expecting. The stock lost $142.20 to $1,906.80.
Disney dropped 3.9 percent, its biggest single-day loss in more than a year, after the media giant reported a weak quarter and said it would pull its movies from Netflix and start two of its own video streaming services. The stock lost $4.15 to $102.83. Netflix also fell, giving up $2.58, or 1.4 percent, to $175.78.
Benchmark U.S. crude added 39 cents to settle at $49.56 a barrel on the New York Mercantile Exchange. Brent crude, used to price international oils, gained 56 cents to $52.70 in London.