Stock Doldrums Continue on Industrial Companies’ Earnings

Stock Doldrums Continue on Industrial Companies’ Earnings

US stocks dipped in a choppy session after the latest round of earnings reports, as a decline in the consumer discretionary sector and interest-rates sensitive stocks outweighed gains in healthcare.

Image by Getty

In mid-afternoon trading, the Dow Jones industrial average was up 0.07%, and the Standard & Poor’s 500-stock index was down 0.01%. The Nasdaq composite index lost 0.35%.

Profits at S&P 500 companies have largely exceeded analysts' estimates for the third quarter so far, setting up the first profit growth since the second quarter of 2015. Thomson Reuters I/B/E/S data shows third-quarter earnings are now expected grow 2.6%, up from the 0.5% decline anticipated at the start of October. Inc reported a lower-than-expected quarterly, as expenses rose and the company provided a disappointing fourth-quarter revenue forecast. Amazon, whose shares were down 6.8% in after-hours trading, said its net income rose to $252 million, or 52 cents per share, from $79 million, or 17 cents per share, a year earlier. It was the company's sixth straight profitable quarter. But earnings per share were far short of the average estimate of 78 cents

The smartphone chip maker Qualcomm said it would buy NXP Semiconductors for $110 a share in cash, or $38 billion. Qualcomm stock rose 4.7%, and shares of NXP gained 0.7%. The deal had been rumored for about a month and investors were excited about the prospect: Qualcomm stock has risen 13% in that time, and NXP shares are up 22%.

Shares of the military contractor Raytheon gave up 3.3% as the company’s outlook failed to impress investors. Shares of the aerospace giant Boeing lost 1.7%, after the stock surged almost 5% on Wednesday, its biggest gain since January 2015.

New orders for US manufactured capital goods unexpectedly fell in September amid weak demand for computers and electronic products, which could temper expectations for an acceleration in business spending in the fourth quarter. Despite the prolonged energy-driven weakness in manufacturing, the rest of the economy is in better shape.

Other reports on Thursday showed a drop in the number of Americans applying for unemployment benefits last week and a jump in contracts to purchase previously owned homes in September.

in other financial news, oil prices stabilized after falling for three consecutive days. United States benchmark crude oil futures rose 69 cents, to $49.87 a barrel on the New York Mercantile Exchange. Brent crude, the international standard, added 69 cents, to $50.67 a barrel in London. The dollar rose to 105.27 yen from 104.66 yen in late trading Thursday. The euro was lower, at $1.0895 from $1.0906.


This information has been prepared by Nadex, a trading name of North American Derivatives Exchange, Inc., prepared by independent third parties contracted by Nadex or reproduced form third party news agencies. In addition to the disclaimer below, the material on this page does not contain an offer of, or solicitation for, a transaction in any financial instrument. Nadex accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication.