By Saumya Vaishampayan And Dan Strumpf
U.S. stocks slipped early Wednesday, though energy shares pulled
ahead as oil prices climbed to five-month highs.
The Dow Jones Industrial Average fell 58 points, or 0.3%, to
17880, reversing gains at the opening bell. The S&P 500 lost
five points, or 0.3%, to 2084. The Nasdaq Composite Index fell 15
points, or 0.3%, to 4924.
Technology stocks posted the sharpest early declines, down 0.6%
in the S&P 500. Shares of Dow component Microsoft Corp. fell
1.3%.
But shares of energy companies remained in positive territory as
U.S. crude prices rose to their highest level since December.
Shares of Exxon Mobil Corp. and Chevron Corp. climbed 0.3%.
"Oil prices have shot up pretty quickly," said David O'Malley,
chief executive of Penn Mutual Asset Management, which has $20
billion under management. "This increase back to $60 a barrel
alleviates some of the fears" about what low oil prices could mean
for the fracking industry and more levered energy companies, he
added.
Crude-oil futures climbed 2.5% to $61.91 a barrel, now at their
highest level since December. Oil prices have surged more than 42%
from their 2015 low of $43.46 reached in March.
Investors received Wednesday a disappointing report on
private-sector employment. Private payrolls in the U.S. increased
by 169,000 in April, according to a report compiled by payroll
processor Automatic Data Processing Inc. and forecasting firm
Moody's Analytics. Economists surveyed by The Wall Street Journal
had expected an increase of 205,000 jobs.
Stocks fell Tuesday, with the Dow pulling back 0.8% to 17928.20.
The S&P 500 declined 1.2% to 2089.46, giving up most of its
gains from a two-day winning streak ended Monday. For the year, the
Dow is up just 0.6% and the S&P has gained 1.5%, through
Tuesday's close.
Investors continued to watch first-quarter earnings. Chesapeake
Energy Corp. said Wednesday it swung to a loss in the first quarter
as the shale driller took a $3.6 billion write-down. Excluding the
impairment and other special charges, profit came in above
expectations. Shares fell 2%.
Mylan NV said Tuesday its revenue rose a less-than-expected 9%,
as foreign currency and acquisition costs weighed on results. The
company affirmed its full-year outlook. Shares rose 0.2%.
Alexion Pharmaceuticals Inc. has agreed to buy Synageva
BioPharma Corp. in a cash-and-stock deal valued at $8.4 billion.
Alexion shares fell 9%, while those of Synageva surged 113%.
Write to Saumya Vaishampayan at saumya.vaishampayan@wsj.com and
Dan Strumpf at daniel.strumpf@wsj.com
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