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US stocks fell on Thursday morning as the Dow's shares were under pressure after disappointing earnings at 3M Co., while positive earnings in the tech sector showed weaker losses on the Nasdaq and the S & P 500.
In the context of a quarterly earnings parade, investors have taken into account the lingering signs of stagnant growth permeating international economies.
How did the benchmarks behave?
The Dow Jones Industrial Average
DJIA, -0.69%
lost 250 points, or 0.9%, to 26,353, the S & P 500 index
SPX, -0.07%
slightly down 9 points, or 0.3%, to 2,917, while the Nasdaq Composite Index
COMP + 0.13%
fell 7 points, or 0.1%, to 8.095.
On Wednesday, the Dow Jones index lost 59.34 points, or 0.2%, to 26,597.05, while the S & P 500 index yielded 6.43 points, or 0.2 %, at 2,927.25. The Nasdaq Composite Index lost 18.81 points, or 0.2%, to 8,102.01. During the session, the technology index set a new intra-day high of 8,139.55.
See: Stock markets break records and bonds go back too
What motivated the market?
Advice from US companies on the state of the economy and the business climate has helped move equity markets forward so far, but growing signs of economic weakness across Europe, Australia, have darkened the markets.
The world's largest exporter, South Korea (paywall), is one of the most recent indicators of a slowdown in expansion, with Asia's first quarter gross domestic product declining 0.3%, which represents its worst performance for more than 10 years. The data came a day after consumer prices in Australia remained stable in the first quarter, raising expectations of a rate cut by the Reserve Bank of Australia.
The series of weaknesses pushed central banks, including the Reserve Bank of Australia, the Bank of Canada and the Bank of Japan, to adopt more accommodative positions, pushing the US dollar to its highest level since about two years. years. is considered likely to contain multinationals at some point.
Meanwhile, a parade of earnings continued, with 3M Co.
MMM, -11.20%
In particular, the market reacted early after the diversified industrial giant reduced its forecasts for 2019 and announced the elimination of 2,000 jobs, the decline in shares of the company constituting the main obstacle for Dow industrialists, weighted by price. Meanwhile, Microsoft Corp.
MSFT, + 3.67%
offset some of the decline after the publication of healthy quarterly results on Wednesday night and the possibility of entering the club for the first time with a market capitalization of one trillion dollars.
See: The stock of Microsoft crosses for the first time its threshold of trillion dollars in intraday
What stocks are under discussion?
Facebook Inc.
FB + 5.97%
Revenues and earnings exceeded Wall Street's estimates, helping to push the company's shares up 6.6%. However, the social media giant has earmarked about $ 3 billion for a possible regulatory fine related to the processing of customer data.
Shares of Microsoft rose 3.6% Thursday, after its results on Wednesday night.
3M Co., the maker of Scotch ribbons and Post-it Notes, saw its shares sell 10.2%.
Actions of Xilinix, Inc..
XLNX, -16.37%
fell more than 15% Thursday morning, after the chip maker exceeded expectations for lower fourth-quarter profits and revenues. The stock has increased 64.1% since the beginning of the year.
Southwest Airlines Co.
LUV + 3.42%
slightly higher by 0.2% after the airline published better than expected in the first quarter, although the load factor remained weak and the company raised its outlook for unit costs.
Lily: Why tech stocks can continue to lead the S & P 500 up, according to two charts
Actions of Altria Group Inc.
MO -5.96%
fell 4.9% after its first quarter report.
Comcast Corp.
CMCSA, + 3.39%
fell 2.8% Thursday morning, after the media company reported first-quarter results above estimates, but lower than expected revenue.
Hershey CoStock of
HSY + 5.05%
rose 5% Thursday morning, after the chocolate and snacks company reported first quarter earnings higher than Wall Street estimates in terms of earnings and income.
United Parcel Service Inc.
UPS -7.22%
saw its shares fall by 8% Thursday after the parcel delivery company released disappointing quarterly results for Wall Street in terms of profits and revenues.
Parts of the defense contractor Raytheon Co.
RTN, -4.85%
fell by 5.8% on Thursday morning, even after better than expected results in the first quarter. The company based in Waltham, Mass., Said it had a net profit of $ 781 million, or $ 2.77 a share, compared with $ 633 million or $ 2.19 a share in the same period of the same year. ;last year.
Tesla Inc.
TSLA, -2.85%
was the focus of concern after the electric car maker produced a larger quarterly loss than expected. Shares were down 1.9%.
Opinion: Elon Musk continues to move the finish line of Tesla
Actions of Deutsche Bank AG
DBK -1.96%
and Commerzbank AG
CBK -3.04%
were at the center of concern after the closing of the merger negotiations by the banking giants. Shares Deutsche Bank listed in Frankfurt lost 1.3% while Commerzbank lost 2.6%.
What data is ahead?
The number of Americans who claimed to receive a first unemployment benefit reached 230,000 people during the week ended April 20, compared to 193,000 the previous week, and more than the expected 201,000 by economists surveyed by MarketWatch.
Durable goods orders rose 2.7% in March, the biggest monthly increase since last summer, the Commerce Department said Thursday. Economists surveyed by MarketWatch were expecting a jump of 0.5%. By eliminating more volatile orders for aircraft and motor vehicles, orders rose 0.4%, higher than the 0.3% expected by economists.
A key measure of business investment, basic durable goods orders, rose 1.3% in March, the third consecutive monthly increase.
National vacancy rates for rental housing remained steady at 7 per cent in the first quarter of 2019 compared to the previous three months, while vacancy rates for homeownership decreased by 0 per cent. , 1%, said Thursday the Department of Commerce.
The national ownership rate of 64.2% remained stable compared to the same period of the previous year, but decreased by 0.6 percentage point compared to the fourth quarter of 2018 .
What do the strategists say?
"This is a good week for profits, but with such low expectations, companies that outperform profits are not rewarded as much as companies that lack forecasts are being hit," JJ Kinihan, chief strategist at TD Ameritrade , told MarketWatch.
"The global reserve currency rose in all areas Wednesday as the dollar index reached its highest level in two years, even without a specific catalyst in the United States. Instead, the greenback took advantage of the weakness of other major currencies, including the euro, the Australian, the kiwi and the loonie, "wrote analyst Marios Hadjikyriacos. in investments at XM.com, in a research note Thursday.
How did the other markets perform?
The Shanghai Composite
SHCOMP, -2.43%
lost 2.2% and CSI 300 index
000300, -2.19%
has dropped 2.2%, while the Stoxx Europe 600 index,
SXXP, -0.27%
was trading 0.6% lower.
Gold price
GCM9, + 0.21%
slightly higher while the ICE Dollar Index
DXY, + 0.06%
dropped about 0.1%.
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