NEW YORK: The Dow’s six-day streak of records ended Thursday as US stocks tumbled, pulled down in part by disappointing earnings reports from Dow members Intel and American Express.
The Dow Jones Industrial Average fell 0.4 percent to 18,517.23.
The broad-based S&P 500 lost 0.4 percent at 2,165.17, while the tech-rich Nasdaq Composite Index shed 0.3 percent to 5,073.90.
“After the run we’ve had, certainly it wouldn’t surprise me if the stock market took a breather here,” said Bill Lynch, director of investment at Hinsdale Associates.
US equity markets have soared the last three weeks, shrugging off worries about the British vote to leave the European Union and well-fuelled by central banks’ commitments to keep interest rates low.
Intel dropped 4.0 percent as it reported a 51 percent decline in second-quarter earnings to $1.3 billion. Analysts also highlighted a disappointing performance in a key data center business.
American Express, another Dow component, fell 1.6 percent after reporting a 37 percent rise in earnings to $2.0 billion in the second quarter. Analysts warned future results could be hit by extra marketing spending.
Biogen jumped 7.6 percent after reporting an eight percent rise in net income to $1.1 billion and pointing to strong growth in the multiple sclerosis and hemophilia businesses. The biotech company announced that chief executive George Scangos would leave the company after a successor is found.
Shares for health insurers jumped after the Justice Department sued to block Aetna’s $37 billion takeover of Humana, and Anthem’s $54 billion merger with Cigna on antitrust grounds.
While they four said they would fight the suits, shareholders appeared to prefer otherwise. Aetna stocks rose 1.6 percent, Anthem 2.6 percent, Humana 8.3 percent, and Cigna 5.4 percent.
Tesla fell 3.4 percent as founder Elon Musk unveiled a second master plan that includes building a new pick-up truck, and an urban bus, and a sharing system of self-driving cars.
Southwest Airlines sank 11.2 percent as it projected third quarter revenue per passenger mile would fall three to four percent due to sharper competition that is driving down fares. The airline was also forced to cancel hundreds of flights Wednesday and Thursday following computing system problems.
Other airlines also suffered, with Delta Air Lines falling 4.2 percent, United Continental 3.4 percent and American Airlines 2.7 percent.
Copyright AFP (Agence France-Presse), 2016
Courtesy : BRecorder