Stocks skid as tech com­pa­nies fall; oil plunge con­tin­ues

The Trentonian (Trenton, NJ) - - BUSINESS - By MAR­LEY JAY AP Mar­kets Writer

NEW YORK >> U.S. stocks fell Fri­day as a com­bi­na­tion of weak eco­nomic data from China and dis­ap­point­ing earn­ings hurt tech­nol­ogy and in­ter­net com­pa­nies. Crude oil prices fell for the 10th day in a row.

Auto sales in China fell in Oc­to­ber for the fourth month in a row and are down 13 per­cent from a year ago, the lat­est sign its econ­omy is un­der pres­sure. Con­cerns about China’s econ­omy and its trade dis­pute with the U.S. con­trib­uted to the global stock mar­ket skid in Oc­to­ber. The stocks that fared the worst dur­ing that time in­cluded tech and in­ter­net com­pa­nies and re­tail­ers, which all took sharp losses Fri­day.

“China has played such a crit­i­cal role in driv­ing global growth,” said Kristina Hooper, chief global mar­ket strate­gist for In­vesco. “(In­vestors) are hav­ing con­cerns that these tar­iff wars are es­sen­tially go­ing to kick China when it’s down.”

U.S. crude oil slipped 0.8 per­cent to ex­tend its los­ing streak. It’s fallen for five weeks in a row and tum­bled 21 per­cent since Oct. 3. En­ergy com­pa­nies have suf­fered steep losses dur­ing that time.

Weak fore­casts from com­pa­nies in­clud­ing video game com­pany Ac­tivi­sion Bliz­zard and chip­maker Sky­works So­lu­tions also con­trib­uted to Fri­day’s de­cline.

The S&P 500 in­dex dropped 25.82 points, or 0.9 per­cent, to 2,781.01. The Dow Jones In­dus­trial Av­er­age fell 201.92 points, or 0.8 per­cent, to 25,989.30.

The Nasdaq com­pos­ite sank 123.98 points, or 1.6 per­cent, to 7,406.90. The Rus­sell 2000 in­dex of smaller com­pa­nies gave up 28.72 points, or 1.8 per­cent, to 1,549.49.

The La­bor De­part­ment said whole­sale prices in the U.S. jumped, and Hooper said that could be linked to the tar­iff dis­pute as well. Whole­sale prices rose by the most in six years in Oc­to­ber as gas, food, and chem­i­cal prices in­creased. The La­bor De­part­ment’s whole­sale price in­dex has climbed 2.9 per­cent over the last year.

Video game maker Ac­tivi­sion Bliz­zard tum­bled after its fore­cast for the crit­i­cal hol­i­day sea­son fell short of an­a­lysts’ pro­jec­tions. The stock fell 12.4 per­cent to $55.01, and Elec­tronic Arts lost 5.3 per­cent to $88.89.

Ma­jor tech­nol­ogy and in­ter­net com­pa­nies also turned lower. Ap­ple fell 1.9 per­cent to $204.47 and Face­book shed 2 per­cent to $144.96. Ama­zon lost 2.4 per­cent to $1,712.43.

Bench­mark U.S. crude fell to $60.19 a bar­rel in New York, its low­est in al­most eight months. Brent crude, used to price in­ter­na­tional oils, has fared al­most as badly as U.S. crude, and it de­clined 0.7 per­cent to $70.20 a bar­rel in Lon­don.

West Coast util­ity com­pa­nies tum­bled as wild­fires wors­ened in South Cal­i­for­nia, with tens of thou­sands of peo­ple forced to flee in Los An­ge­les and Ven­tura coun­ties. PG&E plunged 16.5 per­cent to $39.92 and Edi­son In­ter­na­tional skid­ded 12.1 per­cent to $61.

Gen­eral Elec­tric sank an­other 5.7 per­cent to $8.58 after a JPMor­gan Chase an­a­lyst cut his price tar­get on the stock to $6 a share from $10. Stephen Tusa said six of GE’s eight di­vi­sions might be un­prof­itable in 2020.

Bond prices rose. The yield on the 10-year Trea­sury note fell to 3.18 per­cent from 3.23 per­cent.

De­spite the losses Fri­day, the S&P 500 still gained 2.1 per­cent this week. It climbed 2.4 per­cent last week but would need to rise an­other 5.4 per­cent to reach the all-time high it set on Sept. 20.

Walt Dis­ney’s net earn­ings were bet­ter than ex­pected, as the en­ter­tain­ment gi­ant raked in rev­enue from movies in­clud­ing “Avengers: In­fin­ity War,” “‘In­cred­i­bles 2” and “Ant-Man and the Wasp.” The stock gained 1.7 per­cent to $118.

A fed­eral judge blocked a per­mit from the Trump ad­min­is­tra­tion for the con­struc­tion of Tran­sCanada’s Key­stone XL pipe­line, pend­ing an en­vi­ron­men­tal re­view. The long-de­layed $8 bil­lion project pipe­line would be­gin in Al­berta and run through a half dozen states to ter­mi­nals on the Gulf Coast. U.S. Dis­trict Judge Brian Mor­ris ruled that the po­ten­tial im­pact had not been con­sid­ered as re­quired by fed­eral law after en­vi­ron­men­tal­ists and Na­tive Amer­i­can groups sued to stop the project, cit­ing prop­erty rights and po­ten­tial oil spills.

In Toronto, shares of Tran­sCanada lost 1.7 per­cent.

On­line re­views com­pany Yelp nose­dived after it posted weak third-quar­ter rev­enue and its fore­cast for the fourth quar­ter also fell short of Wall Street’s es­ti­mates. The com­pany said part of the prob­lem is an ad­ver­tis­ing model that is in­tended to en­cour­age ad­ver­tis­ers to try the site with­out sign­ing a long-term con­tract. Yelp said that has made its re­sults more sen­si­tive to short-term prob­lems. Its stock fell 26.6 per­cent to $31.93.

AP PHOTO/RICHARD DREW

Spe­cial­ist Antony Ri­naldi, left, and trader Robert Arciero work on the floor of the New York Stock Ex­change, Fri­day.

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