'Fragile' market slips on earnings
NEW YORK — A batch of negative company news gave investors something to fret over on Thursday.
A day after eking out its first record high of 2014, the stock market lost ground as Best Buy, Goldman Sachs, Citigroup and CSX had disappointing earnings news.
Consumer discretionary companies and banks fell the most.
The Standard & Poor's 500 index slipped 2.49 points, or 0.1 percent, to 1,845.89, retreating from the all-time high it hit the day before.
Best Buy fell the most in the S&P 500 index. The company reported a decline in sales during the crucial holiday season. Its shares plunged $10.74, or 29 percent, to $26.83.
The Dow Jones industrial average fell 64.93 points, or 0.4 percent, to 16,417.01. The Nasdaq composite had a modest gain of 3.80 points, or 0.1 percent, to 4,218.69.
Goldman Sachs was the biggest drag on the Dow, falling $3.58, or 2 percent, to $175.17. The bank reported a drop in fourth-quarter profit because of problems in its mortgages and bond trading division. However, Goldman's earnings beat analysts' expectations.
The bond and mortgage businesses were also weak at Citigroup, whose results fell short of expectations. The stock dropped $2.39, or 4 percent, to $52.60.
The stock market is “fragile” right now, said Scott Clemons, chief investment strategist at Brown Brothers Harriman.
“If something were to go wrong, like if this earnings season continues to disappoint, I think any negative market reaction would be magnified,” Clemons said. “The market is not as resilient as it was last year.”
The company disappointments were not limited to retailers and banks.
CSX warned investors that it might be difficult to reach its profit targets over the next two years because of ongoing weak demand for coal. The news pushed CSX down $1.99, or 7 percent, to $27.24. Other railroad stocks including Union Pacific and Norfolk Southern also fell.
It's still very early in earnings season. Roughly 70 members of the S&P 500 index report next week, including Microsoft, IBM, Delta Air Lines and McDonald's.
Investors retreated into traditional “safe havens” like government bonds, high-dividend stocks and gold. The yield on the 10-year Treasury note fell to 2.84 percent from 2.89 percent the day before.
Show commenting policy
TribLive commenting policy
You are solely responsible for your comments and by using TribLive.com you agree to our Terms of Service.
We moderate comments. Our goal is to provide substantive commentary for a general readership. By screening submissions, we provide a space where readers can share intelligent and informed commentary that enhances the quality of our news and information.
While most comments will be posted if they are on-topic and not abusive, moderating decisions are subjective. We will make them as carefully and consistently as we can. Because of the volume of reader comments, we cannot review individual moderation decisions with readers.
We value thoughtful comments representing a range of views that make their point quickly and politely. We make an effort to protect discussions from repeated comments either by the same reader or different readers.
We follow the same standards for taste as the daily newspaper. A few things we won't tolerate: personal attacks, obscenity, vulgarity, profanity (including expletives and letters followed by dashes), commercial promotion, impersonations, incoherence, proselytizing and SHOUTING. Don't include URLs to Web sites.
We do not edit comments. They are either approved or deleted. We reserve the right to edit a comment that is quoted or excerpted in an article. In this case, we may fix spelling and punctuation.
We welcome strong opinions and criticism of our work, but we don't want comments to become bogged down with discussions of our policies and we will moderate accordingly.
We appreciate it when readers and people quoted in articles or blog posts point out errors of fact or emphasis and will investigate all assertions. But these suggestions should be sent via e-mail. To avoid distracting other readers, we won't publish comments that suggest a correction. Instead, corrections will be made in a blog post or in an article.
- Clean Air Council challenges Sunoco Pipeline’s public utility status
- Stocks, oil prices regain ground after steep 6-day sell-off
- Marcellus shale drillers, Pa. settle 3 cases of fouling water supplies, pay $374K
- BNY Mellon works to overcome computer glitch in investment calculations
- Oilfield giant Schlumberger to purchase Cameron in $12.71B deal
- Dish and Sinclair agree in principle on new contract
- S.W. Randall Toyes & Giftes of Pittsburgh’s owner finds joy in toys
- Busy Beaver Home Improvement Centers join True Value co-op
- Market strategists predict churning, but no major slump
- Roundup: Kraft Heinz recalls more than 2M pounds of turkey bacon; 2 key Mylan shareholders won’t participate in Perrigo vote; more
- Low prices, tough regulations threaten independent oil producers