Oil stocks and IMB drag on Dow
Indices at wall Street ended in a mixed note on Wednesday, 19 APril 2017. The Dow industrials and the S&P 500 ended lower on Wednesday as a drop in oil prices fueled a selloff in energy shares while a drop in IBM was responsible for half the session's losses in the blue-chip average.
The Dow Jones Industrial Average fell 118.79 points, or 0.6%, to 20,404.49, with IBM by far the biggest drag. The S&P 500 which had earlier traded back and forth between slight gains and losses, finished down 4.02 points, or 0.2%, at 2,338.17. The Nasdaq Composite rose 13.56 points, or 0.2%, to finish at 5,863.03. The Nasdaq Composite rose 13.56 points, or 0.2%, to finish at 5,863.03.
IBM shed 4.9% after the tech giant posted weaker-than-expected quarterly sales late Tuesday. It was the biggest one-day drop for the company since June, and the decline took the stock to its weakest level since December. Also, shares of Chevron fell 1.4%, adding further drag to the Dow.
Seven of the S&P 500's 11 primary sectors finished lower on the day. Energy shares closed down 1.4% with oil futures settling down 3.8% at $50.44 a barrel. Health-care and industrial shares posted slight gains. Financials, which had been the lead gainer earlier in the session, finished with a loss.
There were several factors that weighed on the equity market on Wednesday, not the least of which was another disappointing performance from the financial sector. The sector failed to capitalize, yet again, on a positive earnings report from one of its top components. Morgan Stanley jumped 2.0% after beating top and bottom line estimates, but, in similar fashion to last week's reports from JPMorgan Chase and Citigroup, the company's upbeat figures did little to rally the troops.
Oil prices suffered their largest one-day loss in six weeks at Nymex on Wednesday, 19 April 2017 as a steep drop ahead Wednesday's settlement pushed prices to their lowest finish in 2 weeks. An unexpected weekly climb in U.S. gasoline suppliesthe first in about two monthshad fueled earlier losses, which worsened amid volatile trading tied to Thursday's expiration of the May West Texas Intermediate crude contract.
Precious metals ended lower at Comex on Wednesday, 19 April 2017. Gold prices tumbled to their lowest finish in a week on Wednesday as the dollar clawed its way up from the three-week low reached on Tuesday. Still, tensions over North Korea and looming French and U.K. elections that hold implications for the European economy have provided haven investor demand for precious metals in recent days.
On Wednesday, June gold fell $10.70, or 0.8%, to settle at $1,283.40 an ounce. Gold prices had scored a fifth straight session gain on Tuesday to settle at their highest level since early November. Prices for the yellow metal initially extended their losses in electronic trading after the Federal Reserve released its Beige Book synopsis of economic conditions after the gold-price settlement on Wednesday. But prices edged up to $1,283.70 about a half an hour after the report. May silver meanwhile, fell 11 cents, or 0.6%, to settle at $18.162 an ounce, with prices holding ground around that level shortly after the Beige Book release.
The ICE U.S. Dollar Index rose 0.2% to 99.716. Gold and the dollar often move inversely as a stronger dollar dulls the appeal of dollar-pegged assets for investors using other currencies.
On the economic data front, investors received the weekly MBA Mortgage Applications Index. The weekly MBA Mortgage Applications Index decreased 1.8% to follow last week's 1.5% increase.
Tomorrow, investors will receive Initial Claims (consensus 242,000) and the Philadelphia Fed Survey for April (consensus 23.7) at 8:30 ET and March Leading Indicators (consensus 0.3%) at 10:00 ET.
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