MA MasterCard Incorporated

By Ellie Ismailidou and Barbara Kollmeyer, MarketWatch

Ford, Whole Foods slump on weak earnings; Facebook, GoPro jump after results beat expectations

U.S. stocks on Thursday fell for the second straight session, weighed down by disappointing earnings, a drop in oil prices and mixed U.S. economic data.

The moves added to Wednesday's losses, after the Federal Reserve left interest rates unchanged but attempted to tentatively set the table for a possible rate rise as soon as September, stating that near-term risks to the economic outlook (http://www.marketwatch.com/story/fed-appears-more-open-to-september-rate-hike-2016-07-27)have diminished.

The S&P 500 index was off 4 points, or 0.2%, at 2,163, led by a 1% drop in telecom shares, followed by a 0.4% loss in materials stocks, which were pulled lower by the sixth straight decline (http://www.marketwatch.com/story/oil-prices-catch-a-small-break-from-a-weaker-dollar-2016-07-28) for oil futures. Eight of the index's main sectors were in negative territory, while utilities were leading the gains, up 0.2%, followed by consumer staples, up less than 0.1%.

Ford Motor Co.(F)slumped 9.7% following an earnings miss (http://www.marketwatch.com/story/fords-stock-tumbles-after-profit-misses-expectations-2016-07-28), leading the S&P decliners and on track to see their largest daily drop in more than five years.

The Dow Jones Industrial Average lost 70 points, or 0.4%, at 18,402, led by a 2.3% drop in Boeing Co..(BA) but boosted by a 0.8% gain in Apple Inc. (AAPL).

Read: Apple's historic stock surge could confirm something Warren Buffett already knew (http://www.marketwatch.com/story/apples-historic-stock-surge-could-confirm-what-buffett-already-knew-2016-07-27)

Meanwhile the Nasdaq Composite Index was dipping in and out of negative territory, last trading down a point, or less than 0.1%, at 5,138. Upbeat results from Facebook Inc. (http://www.marketwatch.com/story/facebook-posts-huge-revenue-beat-2016-07-27)(FB) boosted the tech-heavy Nasdaq, after the company late Wednesday soundly beat Wall Street expectations for earnings and revenue.

But the social-media network's chief financial officer, Dave Wehner, said the company expects lower ad revenue growth in the next two quarters and just modest growth in its ad load. Shares of Facebook were up 0.8%.

Read:Facebook's rapid growth is about to slow down (http://www.marketwatch.com/story/facebooks-rapid-growth-is-about-to-slow-down-2016-07-27)

(http://www.marketwatch.com/story/facebooks-rapid-growth-is-about-to-slow-down-2016-07-27)Meanwhile, the Fed's hint at a potential interest-rate hike weighed on telecom, the market's big winner this year, up 20% year to date.

"Telecom and utilities have been the place where fixed income investors have gone to hide," while government bond yields recently tumbled to all-time lows, said Kim Forrest, senior portfolio manager at Fort Pitt Capital. Now that "a September rate hike is on the table, though December is more probable," these bond-like stocks are taking a hit.

More broadly, with equity valuations at historical highs and earnings reports coming in mixed, "all the market wants to know is whether the earnings recession is ending," said Quincy Krosby, market strategist at Prudential Financial, pointing to the main benchmarks' inability to push toward new highs over the last couple of sessions.

But others said that the fact that the market hasn't fallen precipitously after an impressive run that brought the S&P and the Dow to all-time highs, is a good sign.

"Simply seeing the range remain intact has been a constructive phenomenon: the longer the [S&P] moves sideways after an almost 10% move, the greater the odds that another up leg results," said Frank Cappelleri, technical analyst at Instinet, in an email.

On the economic front, the number of people who applied for unemployment benefits (http://www.marketwatch.com/story/jobless-claims-climb-14000-to-266000-2016-07-28)last week rose from historical lows, while the nation's trade gap widened in June to $63.3 billion, as imports rose faster than exports. Meanwhile, wholesale inventories were unchanged and retail inventories inched higher.

Stocks to watch: Shares of ConocoPhilips (COP) inched higher by 0.5% despite the fact that the oil company reported a bigger loss than expected. (http://www.marketwatch.com/story/conocophillip-loss-widens-as-revenue-slumps-36-2016-07-28)

Dow Chemicals Co.(DOW) edged up 0.1% after earnings and revenue came in better than forecast by Wall Street.

Colgate-Palmolive Co.(CL) lost 0.1% even after the consumer products firm said profit rose in the second quarter. (http://www.marketwatch.com/story/colgate-palmolive-shares-rise-after-earnings-beat-estimates-2016-07-28)

Harley-Davidson Inc.(HOG) gained 0.7% after the company beat on both profit and revenue (https://www.google.com/url?sa=t&rct=j&q=&esrc=s&source=web&cd=6&cad=rja&uact=8&ved=0ahUKEwjY3P-mkZbOAhUDTCYKHVGmBs8QqQIILTAF&url=http%3A%2F%2Fwww.marketwatch.com%2Fstory%2Fharley-davidson-beats-on-earnings-revenue-lowers-2016-motorcycle-shipment-guidance-2016-07-28&v6u=https%3A%2F%2Fs-v6exp1-ds.metric.gstatic.com%2Fgen_204%3Fip%3D205.203.130.22%26ts%3D1469708091514619%26auth%3Dol6dpt42mbijwgltfzjjxqkdfopmhwzt%26rndm%3D0.7774477069103305&v6s=2&v6t=5112&usg=AFQjCNG1hOjwMybsdl4OL7kojLkSNvrvaw&sig2=KsifhvXI0hzUzuk2isGAhQ&bvm=bv.128450091,bs.2,d.dmo).

Hershey(HSY) swung to a profit in the second quarter (https://www.google.com/url?sa=t&rct=j&q=&esrc=s&source=web&cd=8&cad=rja&uact=8&ved=0ahUKEwjUqaiykZbOAhWD3SYKHWGQAVsQqQIIMTAH&url=http%3A%2F%2Fwww.marketwatch.com%2Fstory%2Fhershey-co-beats-second-quarter-earnings-expectations-2016-07-28&usg=AFQjCNG6tO8gVxg-k6yqBqTCEYiDGTeLfg&sig2=b8nvyO71rUAmRmkBzu0qXA&bvm=bv.128450091,bs.2,d.dmo) (https://www.google.com/url?sa=t&rct=j&q=&esrc=s&source=web&cd=8&cad=rja&uact=8&ved=0ahUKEwjUqaiykZbOAhWD3SYKHWGQAVsQqQIIMTAH&url=http%3A%2F%2Fwww.marketwatch.com%2Fstory%2Fhershey-co-beats-second-quarter-earnings-expectations-2016-07-28&usg=AFQjCNG6tO8gVxg-k6yqBqTCEYiDGTeLfg&sig2=b8nvyO71rUAmRmkBzu0qXA&bvm=bv.128450091,bs.2,d.dmo), leading the shares to rise 3%.

Shares of MasterCard Inc. (MA) climbed 1.4%, after the payments processing and credit card company beat second-quarter profit and revenue expectations (http://www.marketwatch.com/story/mastercards-stock-jumps-after-profit-sales-beat-expectations-2016-07-28).

HCA Holdings Inc.(HCA) lost 1.4% after its earnings missed expectations.

(http://www.marketwatch.com/story/facebook-posts-huge-revenue-beat-2016-07-27)Shares of Whole Foods Market Inc (http://www.marketwatch.com/story/whole-foods-profit-falls-sales-slip-2016-07-27-18485051).(WFM) plunged 9.8% after the upmarket grocer gave a weak forecast for the current quarter as it booked a fourth-straight quarterly profit fall on Wednesday.

GoPro Inc (http://www.marketwatch.com/story/gopro-reports-loss-but-results-beat-estimates-2016-07-27).(GPRO) swung to a loss, but results still beat expectations, and shares jumped 11.8%. Groupon Inc (http://www.marketwatch.com/story/groupon-shares-surge-as-results-top-expectations-2016-07-27-174852644).(GRPN) soared 25.9% after posting better-than-expected results late on Wednesday.

Weight Watchers International Inc (http://www.marketwatch.com/story/weight-watchers-boosts-membership-by-nearly-5-2016-05-04).(WTW) shares inched lower by 0.3% after exploding overnight with a 13% premarket gain, after increasing its membership rolls for the first time in four years.

After Thursday's close, Alphabet Inc.(GOOGL), Amazon.com Inc.(AMZN), Expedia Inc.(EXPE) CBS Corp.(CBSA) are expected to report earnings.

Read:Alphabet earnings bring concern about Google search growth, revenue (http://www.marketwatch.com/story/alphabet-earnings-bring-concern-about-google-search-growth-revenue-2016-07-26)

And: Here's what to expect from Amazon earnings (http://www.marketwatch.com/story/what-to-watch-for-in-amazon-earnings-2016-07-25).

Other markets: The Nikkei 225 index (http://www.marketwatch.com/story/asian-markets-fall-ahead-of-bank-of-japan-meeting-2016-07-27) slipped 1.1% as investors stayed cautious about a potential stimulus plan. The Bank of Japan will wrap up its policy meeting Friday, and some investors expect it to join forces with the government to announce a big batch of stimulus measures the same day.

As the Nikkei fell, the yen moved up against rival currencies, pushing the dollar (http://www.marketwatch.com/story/dollar-pulls-back-vs-yen-as-investors-await-boj-outcome-2016-07-28) lower.

Gold prices surged to $1,331 as some investors took the view that the Fed really doesn't have the option to raise interest rates in September.

Check out: Why gold prices spiked after the Fed decision (http://www.marketwatch.com/story/why-gold-prices-spiked-after-the-fed-decision-2016-07-27)

European stocks struggled amid a batch of big earnings (http://www.marketwatch.com/story/european-stocks-wobble-as-avalanche-of-earnings-reports-rolls-in-2016-07-28).

Read:Do the math--Brexit really is starting to bite at European companies (http://www.marketwatch.com/story/brexit-beats-oil-low-growth-as-hot-topic-during-europes-earnings-season-2016-07-28)

(http://www.marketwatch.com/story/brexit-beats-oil-low-growth-as-hot-topic-during-europes-earnings-season-2016-07-28)--Sara Sjolin contributed to this article.

(END) Dow Jones Newswires

July 28, 2016 13:09 ET (17:09 GMT)

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