US shares edged lower on Thursday amid lack of investor motivation to continue to pursue gains after Dow closed at a record as several big names posted disappointing quarterly results.
While the Thursday tumble was small, it was broad-based, with eight of the ten pillar sectors of the S&P 500 lower for the day. Industrial firms took the deepest plunge under pressure from Textron results. Healthcare names caved in under the weight of Cardinal Health.
Cardinal declined 6.2% to $65.20 as it posted below-estimate revenue. Textron plunged 3% to $39.67 as its earnings dropped from the previous year and sales were little changed.
According to Reuters, both Dow and S&P 500 ended a three-day rally, and the benchmark Dow closed Wednesday at a first record this year, buoyed by bullishness over the economy from the fed, which canceled out a first-quarter economic growth report that was weaker than estimated.
“Earnings have been disappointing, and that, along with concerns over valuation, makes it difficult for the market to make too much headway. We’ll probably continue to lose momentum at the top of the trading range until we get some clearly positive signals,” said strategist Bruce McCain of Cleveland, Ohio-based Key Private Bank.
Stocks of Sony Corp listed in the US dropped 2.1% after the firm adjusted downwards its earnings projections for the third time in a year, estimating hardly 10% of its original forecast.
The Dow Jones industrial average lost 25.06 points or 0.15% at 16,555.78. The Standard & Poor’s 500 Index tumbled 2.41 points or 0.13% at 1,881.47.
Avon Products Inc. lost 13% to exert the heaviest downward pressure to the S&P 500, as Bloomberg reports.
But the Nasdaq Composite Index increased 5.12 points 0.12% at 4,119.68.
On the bright side, Yelp Inc added 13.8% to $66.35, one day after posting impressive surge in revenue.
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