Falling tech stocks pull U.S. indexes off their record highs
NEW YORK — U.S. stock indexes pulled back from their record highs after an afternoon swoon for technology companies helped overshadow another big day for telecoms.
The Standard & Poor’s 500 index fell 2.41 points, or 0.1 percent, from its record set a day earlier to close at 2,475.42. The Nasdaq composite likewise fell from a record, down 40.56, or 0.6 percent, to 6,382.19. The Dow Jones industrial average was an exception, and it rose 85.54, or 0.4 percent, to 21,796.55 to set another alltime high.
Stocks had been on track for another quiet day of gains in a year full of them, but Apple, Microsoft and other technology stocks suddenly changed direction in the afternoon. After being up as much as 0.6 percent in morning trading, tech stocks in the S&P 500 finished the day down 0.8 percent. It was the worst performance among the 11 sectors that make up the index.
Close to half of the companies in the S&P 500 have reported their earnings for the latest quarter, and the results have been mostly encouraging. Not only are profits growing, so are revenues for many companies.
But expectations were high coming into the reporting season, and shares rallied accordingly. Now, companies’ stocks are getting less of a boost than usual when they report earnings that are above analysts’ forecasts, said Nate Thooft, senior portfolio manager at Manulife Asset Management.
Twitter dropped $2.77, or 14.1 percent, to $16.84. It reported better-than-expected quarterly results, but it also said that its monthly average user base did not grow from the prior quarter.
Health care stocks were also weak. Industrial companies also struggled. On the opposite side were telecom stocks, which rallied for a second straight day.
Facebook climbed $4.83, or 2.9 percent, to $170.44 after it reported stronger-than-expected earnings.
Oil and gas prices rose, which helped energy stocks in the S&P 500 rise 1 percent. The price of oil has been on a strong run this week, hitting its highest level since May, and benchmark U.S. crude rose 29 cents to settle at $49.04 Thursday. Brent crude, the international standard, gained 52 cents to $51.49 a barrel.
Natural gas rose 5 cents to $2.97 per 1,000 cubic feet, heating oil gained nearly a penny to $1.60 per gallon and wholesale gasoline rose 3 cents to $1.64 per gallon.
Gold rose $10.60 to $1,260.00 per ounce, silver gained 11 cents to $16.57 an ounce and copper rose nearly a penny to $2.88 a pound.
The yield on the 10-year Treasury rose to 2.32 percent from 2.28 percent late Wednesday. The two-year yield rose to 1.36 percent from 1.35 percent, and the 30-year yield climbed to 2.94 percent from 2.89 percent.
The dollar dipped to 111.09 Japanese yen from 111.30 yen late Wednesday. The euro dipped to $1.1681 from $1.1725, and the British pound fell to $1.3070 from $1.3100.