Stock market today: Wall Street drifts in early trading as more earnings roll in
By Yuri Kageyama And Matt Ott, The Associated Press on July 20, 2023.
NEW YORK (AP) – Stocks are drifting in early trading following a mixed set of profit reports. The S&P 500 was 0.1% lower early Thursday, coming off its seventh gain in the last eight days. The Dow rose 150 points, or 0.4%, and the Nasdaq composite was down 0.5%. Netflix and Tesla helped weigh on the market after the two popular companies reported how much profit they earned during the spring. Tesla fell 4.1% despite reporting stronger profit and revenue than expected. Analysts said investors may be concerned about how profitable the electric vehicle maker will be after cutting prices. Netflix fell 8.6%. THIS IS A BREAKING NEWS UPDATE. AP’s earlier story follows below. Trading is mixed before the opening bell Thursday with more corporate earnings reports incoming and new data on jobs in the U.S. and housing. Futures for the S&P 500 slipped 0.2% before the bell, while the Dow Jones Industrial Average was up 0.1% and could extend its longest winning streak since 2019. Earnings season is picking up momentum in its second week. Wall Street analysts expect a third straight quarter of weaker earnings from S&P 500 companies, but that lowered bar makes it easier for companies to beat expectations and many, particularly banks, already have. Shares in American Airlines dipped 1.3% in premarket, even as the carrier beat Wall Street sales and profit targets and raised its forecast for the rest of the year. Johnson & Johnson shares are up a bit after profits and revenue topped Wall Street expectations. Discover Financial slid more than 12% after it disclosed that it was working with regulators to resolve an accounting error dating back to 2007 that misclassified some credit card accounts. It also said it was suspending share buybacks while it conducts an internal review. After the bell Wednesday, Netflix reported that its subscriber base grew while profit was weaker than forecast. Its shares sank 6.5% in pre-market trading. Investors were also underwhelmed by Tesla’s results, which also came after Wednesday close. Tesla shares were down 3.4% in pre-market trading. Later Thursday, the railroad CSX and Philip Morris report financial results from their most recent quarters. The government also will report on home sales for June and how many people applied for jobless benefits last week. The labor market has shown remarkable strength in the face of elevated interest rates, part of the Fed’s campaign to bring down four-decade high inflation. Hiring has been strong, job openings plentiful and layoffs historically low. Most economists are forecasting that the Fed gets back to raising rates when it meets next week, after pausing in June for the first time in 15 months. Markets have been optimistic that it will be the Fed’s last rate increase this cycle. Recent data have shown inflation at its lowest point since early 2021 – 3% in June compared with a year earlier – and much closer to the Fed’s target of 2%. In Europe at midday, France’s CAC 40 gained 0.4%, Germany’s DAX rose 0.3% and Britain’s FTSE 100 added 0.6%. Japan reported Thursday that it logged a trade surplus in June for the first time in nearly two years as imports sank nearly 13%, largely due to lower oil prices and a weak Japanese yen. Exports rose only 1.5% from a year earlier despite sharp increases in shipments of vehicles as supply chain problems eased. Economists say they anticipate weaker exports in coming months as demand in other major economies slows. Japan’s benchmark Nikkei 225 declined 1.2% to 32,490.52. Australia’s S&P/ASX 200 added less than 0.1% to 7,325.00. South Korea’s Kospi edged down 0.3% to 2,600.23. Hong Kong’s Hang Seng fell 0.1% to 18,928.02, while the Shanghai Composite shed 0.9% to 3,169.52. The tepid results for Netflix and Tesla may have made Asian investors cautious, Stephen Innes, managing partner at SPI Asset Management, said in a commentary. “But with inflation easing and odds for a soft landing rising, investors may adopt an “˜it could have been worse mood,” Innes added. In other trading, benchmark U.S. crude added 33 cents to $75.62 a barrel in electronic trading on the New York Mercantile Exchange. Brent crude, the international standard, also rose 33 cents, to $79.79 a barrel. The U.S. dollar fell to 139.49 Japanese yen from 139.68 yen. The euro cost $1.1211, up from $1.1204. On Wednesday, Wall Street advanced on strong profit reports from banks and other big U.S. companies. The S&P 500 rose 0.2% and has rising nearly 19% this year. It’s at its highest level in more than 15 months. The Dow industrials gained 0.3% and the Nasdaq composite edged up less than 0.1%. – – Kageyama reported from Tokyo; Ott reported from Silver Spring, Md. 26-25
