Stocks turned moderately negative late Thursday, with investors moving to lock in recent gains following a long string of record closes for the S&P 500 and the Dow Jones Industrials Index. The late selloff hit nearly all sectors in the S&P 500, with technology shares the lone sector to finish with gains, largely carried by a big surge for Cisco Systems after the networking giant reported better-than-expected fiscal Q3 results.
Commodities were mixed, with natural gas futures falling 3.5% after the government's weekly inventory report showed an unusually large increase. Gold, meanwhile, continued its slide, declining for a sixth consecutive session.
The Dow see-sawed between gains and losses through much of the session, pulled in opposite directions by Cisco (CSCO) and Wal-Mart Stores (WMT), two component companies that produced diverging Q1 results.
WMT finished about 2% lower after posting weaker-than-expect Q1 financial results and guiding Q2 profit below estimates. The discount retailer reported Q1 EPS of $1.14, missing Wall Street expectations by a penny. Revenue grew 1% to $114.19 bln, also trailing estimates by around $2.1 bln. The company blamed bad weather and delayed tax refunds for the earnings and sales shortfalls.
CSCO rallied 12%, lifting the entire tech sector to a strong finish after reporting Q3 earnings of $0.51 per share, ex items, beating estimate by $0.02. Revenue climbed 5.4% year over year to $12.22 bln, also topping the analyst consensus by $40 mln. The networking giant generated $3.1 bln in cash flows from operations during the latest quarter, down from $3.3 bln from Q2 but up $100 mln from the same quarter last year.
Most of Thursday's economic data missed expectations, although many traders appear to see that as good news, likely keeping the Federal Reserve in the market buying up around $85 bln in bonds each month and flooding the U.S. economy with ample liquidity that's fueled part of the current bull market.
The Labor Department reported first-time jobless claims rose by 32,000 new applications last week to 360,000, far more than the small rise to 330,000 initial claims analysts in a MarketWatch survey were expecting from a revised 328,000 claims reported for the prior week.
The Labor Department also said that the consumer price index fell by a seasonally adjusted 0.4% during April, with lower energy costs offsetting rising food prices. Economists were expecting a 0.3% decline. Overall, inflation has dipped 1.1% during the 12 months ended April 30, falling its lowest level since November 2010.
Also, housing starts declined 16% last month to a seasonally adjusted 853,000, according to Commerce Department figures. Economists polled by MarketWatch had expected a decline to around 965,000 construction starts during April from an annualized 1.036 mln in March. Despite the deeper-than-expected decline,
Commodities were mixed. Crude oil for June delivery settled higher at $95.16 per barrel while June natural gas was derailed by an unusually large build in the government's weekly inventory report, falling cents to $3. per 1 mln BTU. June gold continued its recent slide, falling $9.40 to settle at $1,387.10 per ounce while July silver was flat at $22.66 per share. July copper rose 3 cents to finish at $3.29 per pound.
Here's Where The U.S. Markets Stood At Day's End
- Dow Jones Industrial Average down 42.47 (-0.28%) to 15,233.22
- S&P 500 down 8.31 (-0.50%) to 1,650.47
- Nasdaq Composite down 6.38 (-0.18%) to 3,465.24
- Hang Seng Index up 0.17%.
- Shanghai China Composite Index up 1.22%.
- FTSE 100 down 0.07%.
- (+) EGLE, Reports Q1 earnings of $0.08 per share, easily topping the Capital IQ consensus looking for a $2.05 per share loss. Revenue climbs 37.2% to $72.2 million, also beating the Street view by around $39.21 mln.
- (+) LWAY, Q1 earnings blow past analyst expectations, with the dairy company posting a $0.14 per share profit, beating estimates by $0.05 per share. Net sales totaled $24.4 mln, trailing forecasts by around $520,000. The company this week also acquired a dairy plant in Waukesha, Wisc., quadrupling capacity as it looks to expand into the U.K. and Europe.
- (+) VRTA, Total Q1 revenue rises 30.5% compared to year-ago quarter, rising to $284,000. Posts net income of $0.03 per share, reversing a $0.03 net loss last year. No analyst estimates were available for comparison.
- (+) HALO, Said 42% of the patients with Stage IV pancreatic ductal adenocarcinoma who treated with the company's PEGPH20 drug candidate showed substantial improvement in overall survivability during Phase IB testing.
- (-) ONTY, Said its MUC1 antigen-specific cancer immunotherapy L-BLP25 failed to meet its primary objection of increasing overall survivability in patients with Stage III non-small cell lung cancer compared to a placebo during Phase III testing.
- (-) AMD, Cut to Sell from Neutral at Goldman Sachs, with analyst James Covello writing that Wall Street expectations for the stock simply are too high given the weak PC market.
- (-) INFI, Presenting data from Phase I testing of its IPI-145 drug candidate in patients with relapsed or refractory lymphoma at a pair of industry conferences next month but did not provide any initial details of those trial results. In a new research note, JPMorgan Chase analysts were saying investors are "increasingly skittish" prior to the events.
- (-) TCI, Tumbles to $0.41 per share Q1 net loss, reversing a $0.53 per share profit during the same period last year. Revenue rises just 0.2% from year-ago levels to $27.3 mln. No analyst estimates were available for comparison.
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