By Dan Strumpf And Saumya Vaishampayan
U.S. stocks wobbled between gains and losses Thursday, as
investors pored through the first batch of first-quarter earnings
reports.
The Dow Jones Industrial Average gained five points to 17908.
The S&P 500 rose three points, or 0.1%, to 2085, and the Nasdaq
Composite Index climbed five points, or 0.1%, to 4956.
Trading activity was muted, with investors awaiting additional
quarterly updates expected in the coming weeks. Money managers are
widely bracing for what is expected to be one of the weakest
earnings seasons in years.
"The market is definitely lacking catalysts right now," said Tom
Carter, managing director at JonesTrading. "That's going to
change...but it's early."
The Dow last saw a move of 1% on March 31. On Wednesday, stocks
rose modestly. The Dow added 0.2% and the S&P 500 gained
0.3%.
"The market is exceptionally quiet right now," said Alex
Manzara, vice president at futures brokerage R.J. O'Brien &
Associates. "We're essentially marking time," he added.
Alcoa Inc. unofficially kicked off the first-quarter reporting
season Wednesday after the closing bell. Alcoa shares fell 3.4% as
the aluminum company swung to a profit but its revenue missed
analysts' expectations.
Bed Bath & Beyond Inc. shares lost 6.1% after the retailer
reported a 4% decline in quarterly profit and projected earnings
below Wall Street estimates. The company posted the biggest loss in
the S&P 500, with Alcoa the No. 2 decliner.
Shares of Constellation Brands Inc. rose 0.8% after the
alcoholic-beverage maker reported its first quarterly dividend
since 1973 and reported an increase in profits.
Economic reports have indicated a slowdown in the U.S. economy
at the start of the year. Now, investors are waiting to see how
companies fared in the first quarter. Including 23 companies that
have reported, earnings at S&P 500 companies are expected to
fall 4.9% in the first quarter from a year ago.
Earnings at energy companies are under heavy pressure, expected
to slump 65% from a year earlier, as low oil prices weigh on
results. The strong dollar is another headwind for multinational
companies with significant operations overseas.
Energy stocks pulled ahead Thursday, mirroring a rebound in oil
prices. S&P 500 energy companies gained 1.1%.
"You're in this purgatory period of pre-earnings," said Mark
Spellman, portfolio manager of the $81 million Alpine Equity Income
Fund. "The market is so concentrated on what the Fed says, but now
we're in a quietish period for Fed news...There's going to be a lot
of stock-specific stuff when it comes to earnings."
Federal Reserve officials were divided at their March policy
meeting on whether they might raise interest rates in June,
according to minutes from that meeting released on Wednesday.
Recent soft economic data, including a weak March jobs report,
could make a midyear rate increase even less likely.
The Labor Department said Thursday jobless claims rose by 14,000
to 281,000 in the week ended April 4. Economists surveyed by The
Wall Street Journal expected 280,000 new claims.
Overseas, the Stoxx Europe 600 index gained 1.1%, closing at an
all-time high, its first in 15 years. Germany's DAX added 1.1%,
notching its second-highest close on record. France's CAC 40 gained
1.4%, but remains 25% below its 2000 record.
The euro inched down to $1.0770 from $1.0782 on Wednesday.
The yield on the 10-year Treasury note fell to 1.909% from
1.895% on Wednesday. Yields fall as prices rise.
Walgreens Boots Alliance Inc. said it would close 200 domestic
stores as it continues to restructure. The company reported a 35.5%
increase in sales in its February quarter amid a severe cold
season. Shares added 2.6%.
Oil prices rebounded from their biggest loss in two months.
Crude-oil futures rose 1.7% to $51.22 a barrel.
In commodity markets, gold futures shed 0.3% to $1199.30 an
ounce.
Write to Dan Strumpf at daniel.strumpf@wsj.com and Saumya
Vaishampayan at saumya.vaishampayan@wsj.com
Access Investor Kit for Alcoa, Inc.
Visit
http://www.companyspotlight.com/partner?cp_code=P479&isin=US0138171014
Access Investor Kit for Constellation Brands, Inc.
Visit
http://www.companyspotlight.com/partner?cp_code=P479&isin=US21036P1084
Access Investor Kit for Constellation Brands, Inc.
Visit
http://www.companyspotlight.com/partner?cp_code=P479&isin=US21036P2074