NEW YORK: Wall Street stocks were mixed at the end of a choppy session on Tuesday (Jan 24) as investors digested an uneven set of results from US corporate giants including Verizon and 3M.
Verizon jumped 2.0% after scoring higher revenues on strong subscriber trends, while 3M dived 6.2%t as it announced job cuts in the wake of a weak macroeconomic outlook.
Analysts have been cautious about the fourth-quarter period in light of inflation and higher interest rates that have dented hopes for growth.
“Earnings were mixed but not terrible,” said Peter Cardillo of Spartan Capital Securities.
The Dow Jones Industrial Average rose 104.4 points, or 0.31%, to 33,733.96, the S&P 500 lost 2.86 points, or 0.07%, to 4,016.95 and the Nasdaq Composite dropped 30.14 points, or 0.27%, to 11,334.27.
Among companies not reporting results, Google parent Alphabet lost 2.0% after the Justice Department announced an antitrust suit involving Google’s ad business, asking that it be broken up to level the playing field for other companies.
A spate of NYSE-listed stocks were halted at the top of the session due to an apparent technical malfunction, which caused initial price confusion and prompted an investigation by the US Securities and Exchange Commission.
More than 80 stocks were affected by the glitch, which caused wide swings in opening prices in dozens of stocks, including Walmart Inc and Nike Inc.
“Everybody’s having computer problems, first the airlines and now it’s the NYSE,” said Tim Ghriskey, senior portfolio strategist Ingalls & Snyder in New York. “Seems like it was quickly corrected.”
“Some of the prints were clearly bad,” he added. “It was a surprise. Unexpected.”
Fourth quarter earnings season is in full swing, with 72 of the companies in the S&P 500 having reported. Of those, 65% have beaten consensus, just a hair below the 66% long-term average, according to Refinitiv.
On aggregate, analysts now expect S&P 500 earnings 2.9% below the year-ago quarter, down from the 1.6% year-on-year decline seen on Jan 1, per Refinitiv.
“The Fed will take apart earnings reports and look at how the economy is doing, given the rate hikes and other issues out there,” Ghriskey said. “We’re getting closer to that point where the Fed sees enough progress in the inflation fight to stop the (interest) rate hikes and that’s why the markets have reacted positively lately.”
Economic data showed shallower-than-expected contraction in the manufacturing and services sector in the first weeks of the year, suggesting that the Federal Reserve's restrictive interest rates are dampening demand. – AFP, Reuters