By Anora M. Gaudiano, MarketWatch , Ryan Vlastelica
General Electric posts better-than-expected results
U.S. stocks extended losses in late trade to end lower on
Friday, as weakness in technology and consumer staples shares
offset the latest batch of corporate earnings, which largely
continued to beat expectations.
The selling pressure intensified as the yield on the 10-year
Treasury note hit a more-than-four-year high. The main benchmarks
still posted modest weekly gains, however.
Read more:Hopes are high for this earnings season--and that
could prove dangerous
(http://www.marketwatch.com/story/hopes-are-high-for-this-earnings-seasonand-that-could-prove-dangerous-2018-04-09)
What are the main benchmarks doing?
The Dow Jones Industrial Average fell 201.95 points, or 0.8%, to
24,462.94 but ended the week 0.4% higher.
The S&P 500 declined 22.99 points, or 0.9%, to 2,670.14 with
ten of the 11 main indexes ending with losses. Consumer staples and
technology sector were hit the most, falling 1.7% and 1.5%,
respectively. The benchmark index still posted 0.4% gain over the
week, however.
The Nasdaq Composite Index dropped 91.93 points to 7,146.13, a
decline of 1.3%. Over the week, the tech-heavy index rose 0.5%.
What's driving markets?
While earnings were the primary driver of sentiment earlier in
the week, investors lately grew concerned about a jump in bond
yields that reflect rising inflation expectations.
The 10- year Treasury note yield
(http://www.marketwatch.com/story/treasury-yields-on-track-to-cap-weeklong-climb-2018-04-20)
rose 4.4 basis points to 2.956% on Friday, the highest since
January 2014.
What are strategists saying?
"Had bonds yields risen because the underlying economy is
accelerating, then, we would see higher stock prices too. But
Friday's weakness in stocks suggests that investors sold Treasurys
because they are concerned that wage pressures and protectionist
policies of the White House administration would send inflation
higher," said Kristina Hooper, chief global market strategist at
Invesco.
"Stock prices have been very sensitive to bond yields lately,
selling off each time the 10-year yield reaches some milestone,"
Hooper said.
Volatility in the commodity market also added to
uncertainty.
"I think a lot of people are clueless about what the next $10
move will be for oil, whether it will be up or down, and this adds
to the level of uncertainty in the market, which was already pretty
high," said Chris Bertelsen, chief investment officer of Aviance
Capital Management.
Don't miss:Stock optimism hits two-month high as markets recover
(http://www.marketwatch.com/story/stock-optimism-hits-two-month-high-as-markets-recover-2018-04-19)
See also:Here's why small-cap stocks could be vulnerable to ETF
outflows
(http://www.marketwatch.com/story/heres-why-small-cap-stocks-could-be-vulnerable-to-etf-outflows-2018-04-19)
What stocks are in focus?
GE(GE) shares rose 3.9% after it reported adjusted earnings that
beat Wall Street forecasts, and reaffirmed its guidance. Despite
the gain, the industrial conglomerate remains the worst performing
Dow component over the past year, a period over which it has shed
about 50% of its value.
Baker Hughes(BHGE) reported adjusted earnings that topped
expectations
(http://www.marketwatch.com/story/baker-hughes-revenue-falls-short-2018-04-20),
but revenue that was slightly under forecasts. The stock rose
0.9%.
Apple Inc. (AAPL) tumbled 4.1% after a pair of analysts
(http://www.marketwatch.com/story/apple-stock-falls-after-analysts-express-caution-ahead-of-earnings-2018-04-20)
issued cautious notes ahead of the company's second-quarter
earnings report, due out in early May. The stock was one of the
biggest drags on the overall market.
Honeywell International Inc.(HON) rose 1.6% after reporting its
first-quarter results
(http://www.marketwatch.com/story/honeywell-raises-outlook-as-equipment-demand-rises-2018-04-20-74853548)
and raising its outlook.
Schlumberger Ltd.(SLB) fell 1.5%. The oil giant topped earnings
estimates
(http://www.marketwatch.com/story/schlumberger-tops-earnings-estimates-but-expects-oil-sector-to-see-supply-challenges-this-year-2018-04-20),
but said it expects the sector to see supply challenges this
year.
Atlassian Corp. PLC (TEAM) shares fell 6.5% after the software
maker reported earnings late Thursday
(http://www.marketwatch.com/story/atlassian-shares-fall-more-than-10-after-earnings-2018-04-19).
State Street Corp.(STT)(STT) fell 4.3% despite
better-than-expected earnings and revenue
(http://www.marketwatch.com/story/state-street-boosted-by-higher-markets-2018-04-20).
Twitter Inc.(TWTR) shares rose 1.2% after MKM Partners lifted
shares to buy from neutral
(http://www.marketwatch.com/story/twitter-upgraded-to-buy-at-mkm-partners-shares-up-2-in-premarket-2018-04-20-691951429966766).
Opinion:Intel, beware: AMD is a different company than it was
just two years ago
(http://www.marketwatch.com/story/intel-beware-amd-is-a-different-company-than-it-was-just-two-years-ago-2018-04-19)
Pivotal Software Inc.(PVTL) rose 4.9% in its trading debut,
after its initial public offering was priced at $15 a share. The
cloud-software company is majority controlled by Dell Technologies
Inc. and VMware Inc. (VMW).
See:Pivotal IPO--5 things to know about the cloud software
company
(http://www.marketwatch.com/story/pivotal-ipo-5-things-to-know-about-the-cloud-software-company-2018-04-20)
What are other markets doing?
(http://www.marketwatch.com/story/european-stocks-edge-up-as-commodity-industrial-shares-advance-2018-04-19)European
stocks ended a volatile session marginally lower
(http://www.marketwatch.com/story/european-stocks-fall-from-7-week-high-as-consumer-goods-shares-struggle-2018-04-20).
Asian markets also finished lower, as chip-related stocks got hit
(http://www.marketwatch.com/story/asian-markets-sink-with-chip-makers-leading-declines-2018-04-19).
Gold futures
(http://www.marketwatch.com/story/wobbly-gold-heads-for-narrow-weekly-drop-as-surging-silver-pulls-back-2018-04-20)
posted a second week of losses, after settling 0.8% lower at
$1,338.30 an ounce on Friday.
The ICE U.S. Dollar Index climbed to an 11-day high
(http://www.marketwatch.com/story/treasury-yields-on-track-to-cap-weeklong-climb-2018-04-20),
boosted partially by higher Treasury yields.
Oil prices settled
(http://www.marketwatch.com/story/oil-prices-hold-steady-as-investors-await-opec-meeting-2018-04-20)
with a modest gain Friday, shaking off earlier weakness sparked by
a tweet from U.S. President Donald Trump
(http://www.marketwatch.com/story/oil-prices-hold-steady-as-investors-await-opec-meeting-2018-04-20).
Read:Why Trump is tweeting about OPEC--and what he can do about
oil prices
(http://www.marketwatch.com/story/why-trump-is-tweeting-about-opec-and-what-he-can-do-about-oil-prices-2018-04-20)
(http://www.marketwatch.com/story/oil-prices-hold-steady-as-investors-await-opec-meeting-2018-04-20)
(END) Dow Jones Newswires
April 20, 2018 16:44 ET (20:44 GMT)
Copyright (c) 2018 Dow Jones & Company, Inc.