Skip to main content

The Globe and Mail

The close: S&P 500 hits one-month low as earnings season begins

Trader Frederick Reimer tries to hear his phone on the floor of the New York Stock Exchange Thursday, Sept. 20, 2012.

Richard Drew/AP

Stocks sank on Wednesday after Alcoa Inc. began the third-quarter earnings season with a disappointing report, raising concerns about corporate earnings amid a slowing global economy.

The Dow Jones industrial average closed at 13,344.97, down 128.56 points or 1 per cent. The broader S&P 500 closed at 1432.56, down 8.92 points or 0.6 per cent – marking the fourth straight decline for the benchmark U.S. index. In Canada, the S&P/TSX composite index closed at 12,212.42, down 61.15 points or 0.5 per cent.

Alcoa Inc. fell 4.6 per cent after it reported quarterly results on Tuesday evening after markets closed. While the company's adjusted earnings – which exclude special items – beat analysts' expectations, Alcoa lowered its outlook for 2012 given the slowdown in China.

Story continues below advertisement

Chevron Corp. fell 4.2 per cent after the energy producer warned that its earnings would be hurt by hurricane activity and foreign exchange losses.

However, the gloom did not affect all corners of the market. Yum Brands Inc. jumped 7.5 per cent after the fast-food company reported that its earnings rose 19 per cent on a per share basis.

Costco Wholesale Corp. rose 1.9 per cent after it reported earnings of $1.39 (U.S.) per share, up from $1.08 last year, topping expectations.

FedEx Corp. rose 5.2 per cent after it announced a plan to slash costs and boost earnings by $1.7-billion over the next three years.

Commodity prices were mixed. Crude oil fell to $91.25 a barrel, down $1.14. Gold rose slightly to $1,765.10 an ounce, up 10 cents. Among Canadian commodity producers, Suncor Energy Inc. fell 1.2 per cent and Barrick Gold Corp. fell 0.5 per cent.

However, AuRico Gold Inc. jumped 21.4 per cent after it announced the sale of its Ocampo mine in Mexico for $750-million.

Report an error Licensing Options
About the Author
Investing Reporter

David Berman has been writing about business and investing since 1995. He has written for a number of magazines, including Canadian Business and MoneySense. He worked at the Financial Post as an investing writer and daily columnist before moving to the Globe and Mail in 2008. More

Comments

The Globe invites you to share your views. Please stay on topic and be respectful to everyone. For more information on our commenting policies and how our community-based moderation works, please read our Community Guidelines and our Terms and Conditions.

We’ve made some technical updates to our commenting software. If you are experiencing any issues posting comments, simply log out and log back in.

Discussion loading… ✨