BLBG U.S. Stocks Fluctuate Amid Mixed Earnings While Crude Retreats
U.S. stocks fluctuated as mixed earnings reports provided little direction, and energy producers retreated as crude oil fell from a 15-month high.
The S&P 500 Index slipped less than 0.1 percent to 2,144.11 at 10:15 a.m. in New York, following the first back-to-back gains in two weeks. The benchmark was holding near its average price during the past 100 days after closing yesterday above the closely watched level for the first time in seven sessions. The Dow Jones Industrial Average added 24.96 points, or 0.1 percent, to 18,227.58. The Nasdaq Composite Index was little changed.
“Last week and earlier this week we had some bank earnings that were pretty good,” said Timothy Ghriskey, who helps manage $1.5 billion as chief investment officer at Solaris Asset Management LLC in New York. “We’ve seen a number of industrial companies, however, either pre-announce or report some weak earnings and that’s certainly been negative.”
The European Central Bank today kept its quantitative-easing program and interest rates unchanged. U.S. equity futures earlier followed European shares lower after the central bank’s President Mario Draghi said during a press conference that the euro region’s economic outlook remains subject to downside risks. He also reiterated that officials will extend stimulus if needed.
The S&P 500 climbed in the prior two days, trimming its monthly decline amid a spate of results showing signs that companies may break a five-quarter streak of declining profits. Microsoft Corp. and PayPal Holdings Inc. are among firms due to release earnings today.
Among shares moving on earnings news:
American Express Co. rallied the most in seven years after boosting its projection for annual profitability.
Travelers Cos. lost 3.2 percent, the steepest slide in the Dow, after posting its fourth-straight profit decline as weather-related costs climbed and investment income slipped.
EBay Inc. suffered its worst drop since January after forecasting fourth-quarter revenue and profit that may miss projections.
Verizon Communications Inc. sank 2.3 percent after adding fewer monthly mobile subscribers than analysts had predicted.
Central banks have held sway over equity markets this year, with investors parsing economic data and comments by officials for hints on the timing of the Federal Reserve’s next interest-rate increase. Traders are pricing in less than one-in-five odds of a hike at the next meeting that takes place days before the presidential election, and a 68 percent probability of a move in December.
A report today showed filings for U.S. unemployment benefits rose last week by the most since July, after spending several weeks at or near a four-decade low. A separate gauge indicated expansion in Philadelphia-area manufacturing slowed this month, while another measure showed sales of previously owned homes increased more than projected in September, showing residential real estate continues to contribute modestly to growth.
While a fifth of S&P 500 companies have reported results so far, nearly 83 percent of them beat earnings expectations, while 64 percent topped sales projections, according to data compiled by Bloomberg. Analysts forecast profits will fall 1.4 percent.
“It’s started off to be a reasonable environment so far in terms of earnings,” said Patrick Spencer, London-based vice chairman of equities at Robert W. Baird, which manages $151 billion. “I suspect that is going to continue, that the trend of surprising on the upside is going to be a feature in this quarter. That will continue to support the market.”
