Dow, S&P close lower as IBM, Intel weigh in, coronavirus concerns rise



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NEW YORK (Reuters) – The Dow and S&P 500 finished slightly lower on Friday, dragged down by losses in blue chip tech, pillars Intel and IBM following their quarterly results, as hopes of a full economic reopening in the coming months dwindled.

IBM Corp fell 9.91% and was the main drag on the Dow Jones Industrial Average after missing quarterly revenue estimates, penalized by a rare drop in sales of its software unit.

Intel Corp slipped 9.29% as post-earnings comments from new CEO Pat Gelsinger suggested the lack of strong outsourcing adoption.

However, losses in the tech sector were offset by gains at Microsoft Corp Apple Inc, keeping declines in major US stock indexes in check and raising the Nasdaq slightly.

Energy and Financials were the worst performers among the 11 S&P sectors on Friday, while defensive utilities and real estate groups advanced.

“Any delay or setback in the reopening theme will likely be a headwind for the energy industry,” said Andrew Mies, chief investment officer at 6 Meridien in Wichita, Kansas.

“(But) the market is telling you that its confidence in cyclics is diminished right now.

FILE PHOTO: A Wall Street sign is pictured outside the New York Stock Exchange in the Manhattan neighborhood of New York, New York, United States October 2, 2020. REUTERS / Carlo Allegri / File Photo

The S&P 500 and Nasdaq cut some losses shortly after the opening bell as data showed US manufacturing activity surprisingly hit its highest level in more than 13-1 / 2 years to start. January, unlike a disappointing result from the purchasing manager. data in Europe earlier.

The Dow Jones Industrial Average fell 179.03 points, or 0.57%, to 30,996.98, the S&P 500 lost 11.6 points, or 0.30%, to 3,841.47 and the Nasdaq Composite added 12.15 points, or 0.09%, at 13,543.06.

The volume on the US stock exchanges was 12.79 billion shares, compared to 12.68 billion on average for the full session over the last 20 trading days.

Despite the weakness, all three major indexes posted weekly gains, with the high-tech Nasdaq continuing its best weekly performance since November 6, as investors piled into Alphabet Inc, Apple Inc and Amazon.com Inc in anticipation of their reports coming weeks.

For the week, the S&P rose 1.94%, the Dow added 0.59% and the Nasdaq reportedly gained 4.19%.

As stock valuations approach levels not seen since the Dotcom era, some market participants have said that the new COVID-19 variants and the hiccups in vaccine rollouts pose near-term risks.

President Joe Biden said on Friday that the U.S. economic crisis was deepening and the government needed to take major action now to help struggling Americans.

“The absolute assurance that investors felt a week ago … part of that is starting to fade from the market.” Mies added, regarding the decline of the virus and the reopening of the economy.

The Senate Finance Committee unanimously approved Janet Yellen’s appointment as the first female Treasury Secretary, saying she would easily get full Senate approval.

Falling issues outnumbered those that rose on the NYSE by a ratio of 1.00 to 1; on the Nasdaq, a ratio of 1.53 to 1 favored the advancers.

The S&P 500 posted 16 new 52-week highs and no new lows; the Nasdaq Composite recorded 189 new highs and 7 new lows.

Echo Wang report in New York; Additional reporting by Devik Jain and Medha Singh in Bengaluru; Editing by Saumyadeb Chakrabarty, Anil D’Silva and Diane Craft

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