Stocks Mixed as Tech Shares Fall on Earnings
October 26 2016 - 12:07PM
Dow Jones News
By Akane Otani and Mike Bird
U.S. stocks were mixed Wednesday as oil prices pared losses and
investors parsed the latest stream of earnings results.
Corporate earnings have driven some of the largest moves in
stocks over the past week. More than a third of S&P 500
companies have now reported quarterly results, according to
FactSet, with energy, industrials and technology companies posting
the weakest earnings growth so far.
On Wednesday, the S&P 500 technology sector fell 0.2%, among
the worst performers in the index. Apple, which posted its first
annual revenue decline in 15 years on Tuesday, was the biggest
loser in both the sector and the Dow Jones Industrial Average,
falling 2.8%.
The company is now the biggest drag on the S&P 500 tech
sector's third-quarter earnings growth, according to FactSet
analyst John Butters.
"Earnings growth is going to be really, really key for continued
growth in the market, even though we've muddled along without that
for a while, " said Karyn Cavanaugh, senior market strategist at
Voya Investment Management.
The Dow Jones Industrial Average was up 59 points, or 0.3%, at
18228 and the Nasdaq Composite was down 0.1%. The S&P 500 was
up less than 0.1%.
Boeing rose 1.9% and was among the biggest gainers in the Dow
industrials after the aircraft maker raised its guidance for the
year.
Energy shares reversed course after being among the worst
performers earlier in the session. The S&P 500 energy sector
climbed 0.5% after an Energy Information Administration report
showed U.S. crude oil inventories fell last week. U.S. crude oil
prices were recently down 0.6% at $49.70 a barrel.
Noble Energy gained 2.3%, Apache rose 2.1% and Baker Hughes
ticked up 1%.
Bond yields in developed markets picked up. The yield on the
10-year Treasury note was recently 1.793%, according to Tradeweb,
compared with 1.758% Tuesday. German 10-year yields rose to 0.09%,
from around 0.02% on Tuesday.
Elsewhere around the globe, stocks mostly fell.
The Stoxx Europe 600 index pulled back 0.4%. The U.K.'s FTSE 100
index dropped 0.9% and Germany's DAX declined 0.5%.
Asian stocks closed broadly lower, with Hong Kong's Hang Seng
down 1%. Japanese equities bucked the trend with the Nikkei Stock
Average closing up slightly.
In currencies, the British pound bounced back against the dollar
and was recently up 0.4% at $1.2226 after falling Tuesday.
"With the terms and conditions of the U.K.'s future trade links
still unclear it is too early to rule out further downside risks in
sterling," said Geoffrey Yu, head of UBS Wealth Management's U.K.
investment office. Mr. Yu believes sterling could fall to as low as
$1.10 temporarily over the next year.
Write to Akane Otani at akane.otani@wsj.com and Mike Bird at
Mike.Bird@wsj.com
(END) Dow Jones Newswires
October 26, 2016 11:52 ET (15:52 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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