The Morning Journal (Lorain, OH)
Stocks post first loss of week as tech drops
Losses among tech and consumer products weighed on stocks, snapping a three-day winning streak.
Losses among technology and consumer products companies weighed on U.S. stocks Thursday, snapping a three-day winning streak for the market.
Banks bucked the trend, rising along with bond yields. Energy companies also eked out a slight gain, despite a late-afternoon downturn in oil prices. The broad market slide came as investors pored over the latest corporate quarterly results.
“The earnings were a little bit disappointing today and we’re just really seeing, especially within the tech sector, followthrough on some of the big names that have reported disappointing numbers in some key spaces,” said Lindsey Bell, an investment strategist at CFRA Research.
The S&P 500 index fell 15.51 points, or 0.6 percent, to 2,693.13. The Dow Jones industrial average slid 83.18 points, or 0.3 percent, to 24,664.89. The drop knocked the blue chip average slightly into the red for the year.
The Nasdaq composite lost 57.18 points, or 0.8 percent, to 7,238.06. The Russell 2000 index of smaller-company stocks gave up 9.74 points, or 0.6 percent, to 1,573.82.
The major indexes were headed lower from the get-go as investors looked over the latest corporate earnings. Disappointing results from Philip Morris International and Procter & Gamble helped pull the market lower early on.
Philip Morris disclosed weak quarterly sales and said sales of its iQos device in Japan were slower than expected. The stock was the biggest decliner in the S&P 500, sinking 15.6 percent to $85.64. That’s the tobacco company’s worst single-day loss of all time.
Procter & Gamble declined 3.3 percent to $74.95 despite posting results that topped Wall Street’s forecasts. The consumer products company reported a flat thirdquarter profit and President and CEO David Taylor said the company is facing a challenging “macro environment” and that markets that it operates within are being transformed.
Technology stocks, still the biggest gainers this year, weighed on the market. Companies in the computer chip business were big decliners for the second day in a row. Lam Research, which makes chip-making equipment, led the slide, dropping 6.6 percent to $190.39.
Qualcomm slid 4.8 percent to $52.57 after the Chinese government said it still has concerns about the company’s deal to buy NXP Semiconductors. Qualcomm withdrew one proposal for the deal Monday and submitted another.
Financial analysts are forecasting the strongest growth in seven years for S&P 500 companies, partly because of a resurgent global economy, but also because of expectations that last year’s corporate tax cut will have on corporate balance sheets.