U.S. stocks slid in a volatile session on Friday, with the Nasdaq closing below the 4,000 mark for the first time since early February.
Selling accelerated late in the afternoon, with the biotech and other momentum stocks again leading the Nasdaq sharply lower. JPMorgan’s disappointing earnings also gave investors a reason to sell some bank stocks.
The S&P/TSX composite index lost 50.31 points to 14,257.69. The Canadian dollar dropped 0.42 of a cent to 91.08 cents (U.S.).
A disappointing earnings report before the open from banking giant JPMorgan Chase helped push the Dow Jones industrials down 143.47 points 16,026.75, the Nasdaq composite index declined 54.38 points to 3,999.73 and the S&P 500 index gave back 17.39 points to 1,815.69.
Shares of Herbalife sold off late in the day after the Financial Times reported that the Department of Justice and the FBI had launched a probe into the company. The stock tumbled 14 per cent to close at $51.48.
JPMorgan Chase shares backed off 3.66 per cent to $55.30 as it reported its first-quarter profit fell 19 per cent to $5.3-billion, or $1.28 a share. Revenue fell eight per cent to $22.99-billion, led by weak trading revenue. Analysts had expected earnings of $1.39 a share on revenue of $24.43-billion, according to FactSet.
North American stocks tumbled Thursday following disappointing trade data from China that raised another round of questions about the health of the world’s second-biggest economy. Traders are now looking ahead to next week when the Chinese government releases its first-quarter growth figures.
There was another sign of economic weakness in data out Friday which showed that China’s growth in auto sales decelerated further in March with sales up 7.9 per cent to 1.7 million vehicles, down from February’s 11.3 per cent growth.
Biotech and technology sectors have been particularly in investors’ cross hairs.
“There are some areas of the market, and those are the poster children, where one would have to be concerned about valuations,” said Paul Taylor, chief investment officer of fundamental Canadian equities at BMO Global Asset Management.
“And so it is healthy to see those areas which have been most frothy if you will, to see them reacting a little more rationally.”
After making big gains last year, biotechs have been crushed in recent weeks as they come under pressure to lower prices for their drugs. And traders continued to punish some of the biggest tech giants from last year, including Facebook and Google.
The TSX lost one per cent this past week but New York markets were particularly hammered.
The gold sector led decliners, down about one per cent while June bullion faded $1.50 to $1,319 an ounce.
TSX tech and health-care stocks also continued to deteriorate and stocks in these two groups led decliners on the Toronto market this week.
The financials sector was off 0.22 per cent following the JPMorgan Chase report.
The base metals group slipped 0.14 per cent while May copper shed early gains and closed unchanged $3.04 a pound.
The energy sector was slightly higher while the May crude contract on the New York Mercantile Exchange edged up 34 cents to $103.74 a barrel.Report Typo/Error
- JPMorgan Chase & Co$85.49+0.37(+0.43%)
- Herbalife Ltd$50.37-0.48(-0.94%)
- S&P/TSX Composite15,312.20+17.00(+0.11%)
- S&P 500 INDEX2,259.53+13.34(+0.59%)
- Dow Jones Industrials19,756.85+142.04(+0.72%)
- NASDAQ NMS COMPOSITE INDEX5,444.50+27.14(+0.50%)
- Gold Front Month Futures$1,158.40-11.40(-0.97%)
- Updated December 8 7:01 PM CDT. Delayed by at least 15 minutes.