US stock indexes veer lower in morning trading

AP News
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Posted: Aug 10, 2016 11:51 AM
US stock indexes veer lower in morning trading

U.S. stock indexes declined in morning trading Wednesday, pulled down by a slide in energy companies as oil prices headed lower. Banks and health care companies also weighed on the market, while consumer-focused stocks bucked the trend. Investors were focused on company earnings from retailers, restaurant chains and other companies.

KEEPING SCORE: The Dow Jones industrial average fell 38 points, or 0.2 percent, to 18,494 as of 11:41 a.m. Eastern time. The Standard & Poor's 500 index shed six points, or 0.3 percent, to 2,175. The Nasdaq composite index lost 28 points, or 0.5 percent, to 5,197. The Nasdaq was coming off a record high close on Tuesday.

EYE ON CONSUMERS: Corporate earnings, most of which have now been reported, seem to have been relatively good for the second quarter. A strong jobs report last Friday boosted investors' confidence in the U.S. economy. Investors should get some insight into the health of consumer demand this week as several major retailers report quarterly results and the government delivers its latest monthly retail sales figures on Friday.

THE QUOTE: "The volumes have been very light and you don't have much key economic news coming out in the U.S. this week," said Sean Lynch, co-head of global equity strategy at Wells Fargo Investment Institute. "But sometimes that's when you get some real moves in the market."

DOSE OF TROUBLE: Perrigo sank 10.5 percent after the pharmaceuticals company cut its guidance for the year, citing growing competition and falling prescription drug prices. The stock lost $9.99 to $85.10.

WHERE'S THE REVENUE: Wendy's fell 2.6 percent after the hamburger chain said a key sales measure fell sharply in its latest quarter. Its shares slid 26 cents to $9.93.

SCORCHED: Traders sought shade from SunPower after the solar products and service company tumbled 29.7 percent. The company said its power plant business is struggling amid growing competition and project delays. The stock lost $4.39 to $10.39.

NOT IN STYLE: Michael Kors slid 0.9 percent after the clothing company forecast weaker sales for the current quarter and lowered its outlook for sales at established stores. The stock fell 43 cents to $49.68.

GOOD REVIEW: Yelp jumped 14.5 percent after the online business review portal reported strong quarterly results. The stock added $4.72 to $37.36.

FASHIONABLE RESULTS: Watch and accessories maker Fossil Group and clothing company Ralph Lauren surged after the retailers delivered strong quarterly results. Fossil added $1.45, or 4.8 percent, to $31.81, while Ralph Lauren gained $10.33, or 10.9 percent, to $105.40.

GLOBAL MARKETS: In Europe, Germany's DAX fell 0.4 percent, while France's CAC 40 dipped 0.4 percent. Britain's FTSE 100 was up 0.1 percent. Earlier, Japan's Nikkei 225 lost 0.2 percent despite a report showing private sector machinery orders rebounded in June from May. Hong Kong's Hang Seng edged up 0.1 percent, while Australia's S&P ASX 200 fell 0.2 percent. South Korea's Kospi added less than 0.1 percent. Stocks in Taiwan and Singapore also were higher, but markets in China, Indonesia and New Zealand declined.

OIL: A bigger-than-expected increase in U.S. oil stockpiles last week weighed on the price of crude, reversing an early gain. Benchmark U.S. crude was down 66 cents, or 1.5 percent, at $42.11 per barrel in New York. The contract fell 25 cents on Tuesday. Brent crude, used to price international oils, was down 87 cents, or 1.9 percent, at $44.11 per barrel in London.

BONDS AND CURRENCIES: Bond prices rose. The yield on the 10-year Treasury note fell to 1.52 percent from 1.55 late Tuesday. In currency markets, the dollar weakened to 101.31 yen from 101.90 on Tuesday, while the euro strengthened to $1.1169 from $1.1107.