The S&P 500 ended nominally lower on Tuesday at the close of a rocky session marked by a raft of mixed earnings and a technical malfunction at the opening bell. The TSX was nearly unchanged.
A spate of NYSE-listed stocks were halted at the top of the session due to an apparent technical malfunction, which caused initial price confusion and prompted an investigation by the U.S. Securities and Exchange Commission (SEC).
More than 80 stocks were affected by the glitch, which caused wide swings in opening prices in dozens of stocks, including Walmart Inc and Nike Inc.
“Everybody’s having computer problems, first the airlines and now it’s the NYSE,” said Tim Ghriskey, senior portfolio strategist Ingalls & Snyder in New York. “Seems like it was quickly corrected.”
The Nasdaq joined the S&P 500 in negative territory, while the Dow ended modestly higher.
Fourth quarter earnings season is in full swing, with 72 of the companies in the S&P 500 having reported. Of those, 65% have beaten consensus, just a hair below the 66% long-term average, according to Refinitiv.
On aggregate, analysts now expect S&P 500 earnings 2.9% below the year-ago quarter, down from the 1.6% year-on-year decline seen on Jan. 1, per Refinitiv.
“The Fed will take apart earnings reports and look at how the economy is doing, given the rate hikes and other issues out there,” Ghriskey said. “We’re getting closer to that point where the Fed sees enough progress in the inflation fight to stop the (interest) rate hikes and that’s why the markets have reacted positively lately.”
The Dow Jones Industrial Average rose 104.4 points, or 0.31%, to 33,733.96, the S&P 500 lost 2.86 points, or 0.07%, to 4,016.95 and the Nasdaq Composite dropped 30.14 points, or 0.27%, to 11,334.27.
Among the 11 major sectors of the S&P 500, industrials led the percentage gainers, while communication services suffered the biggest loss.
Intercontinental Exchange Inc, owner of the New York Stock Exchange, dropped 2.2% as SEC investigators searched for the cause of Tuesday’s opening bell confusion.
Alphabet Inc shares dipped 2.1% after the Justice Department filed a lawsuit against Google for abusing its dominance of the digital advertising business.
Industrial conglomerates 3M Co and General Electric Co both provided underwhelming forward guidance due to inflationary headwinds.
3M’s shares lost 6.2% while General Electric’s rose 1.2%.
Aerospace/defense companies Lockheed Martin Corp and Raytheon Technologies Corp were a study in contrasts, with the former issuing a disappointing profit forecast and the latter beating estimates on solid travel demand.
Lockheed Martin and Raytheon were up 1.8% and 3.3%, respectively.
Railroad operator Union Pacific Corp missed profit estimates as labor shortages and severe weather delayed shipments. Its shares shed 3.3%.
Microsoft gained more than 4% in extended trading after narrowly missing quarterly revenue estimates.
The S&P/TSX Composite Index closed down 2.03 points, or 0.01%, at 20,629.55.
Shares of Magna slumped 7.2% after the automotive supplier cut its earnings margin outlook. That weighed on the consumer discretionary sector, which lost 0.7%.
A Canadian court dismissed the competition bureau’s effort to block Rogers Communications Inc’s $20 billion bid to buy Shaw Communications Inc, in a boost to the companies’ efforts to close a deal struck nearly two years ago. Rogers rose 2.9% and Shaw was up 2.8%.
Both the TSX energy and tech sectors lost about 1%.
Crude oil prices slipped on concerns about a global economic slowdown and an expected build in U.S. oil inventories. U.S. crude fell $1.49, or 1.8%, to $80.13 per barrel.
U.S. business activity contracted in January for the seventh straight month, though the downturn moderated across both the manufacturing and services sectors for the first time since September and business confidence strengthened as the new year began.
The U.S. economy “still could roll over and some energy traders are still skeptical on how quickly China’s crude demand will bounce back this quarter,” OANDA analyst Edward Moya said in a note.
Euro zone business activity made a surprise return to modest growth in January, S&P Global’s flash Composite Purchasing Managers’ Index showed. Yet British private sector economic activity fell at its fastest rate in two years.
Reuters, Globe staff
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