(Reuters) – Wall Street’s main indexes struggled for direction on Thursday as an abrupt end to a U.S.-North Korean summit and a clutch of weak earnings hit sentiment, with a better-than-feared GDP data offering some support.
Traders work on the floor of the New York Stock Exchange (NYSE) in New York, U.S., February 25, 2019. REUTERS/Brendan McDermid
President Donald Trump said he had walked away from a nuclear deal at his summit with Kim Jong Un in Vietnam because of unacceptable demands from the North Korean leader to lift U.S.-led sanctions.
“After the lack of results from the North Korean summit, there could be some nervousness about the possibility of similar results coming out of China tariff negotiations,” said Jake Dollarhide, chief executive officer of Longbow Asset Management in Tulsa, Oklahoma.
“But the biggest factor is that we’ve had a sharp rise since the Christmas Eve lows. A lot of people are just nervous that we’ve come too far too fast.”
The S&P 500 index is set to record its third straight day of losses, after being boosted in the recent weeks by optimism around trade and dovish signals from the Federal Reserve. The benchmark index is about 5 percent away from its September record closing high.
Adding to the cautious mood was a bunch of bleak earnings reports. HP Inc plunged about 17 percent after the company’s revenue fell short of analysts’ estimates.
Booking Holdings Inc fell 9.62 percent after the company missed quarterly earnings expectations and was among the biggest drags on the S&P 500 and the Nasdaq Composite.
At 12:51 p.m. ET, the Dow Jones Industrial Average was down 29.20 points, or 0.11 percent, at 25,955.96. The S&P 500 was down 0.92 points, or 0.03 percent, at 2,791.46 and the Nasdaq Composite was up 3.46 points, or 0.05 percent, at 7,557.97.
Data from the Commerce Department showed the U.S. economy slowed less than expected in the fourth quarter amid solid consumer and business spending.
This comes ahead of the core personal consumption expenditures (PCE) data for December, the Fed’s preferred measure of inflation, due on Friday.
Of the 11 major S&P 500 sectors, the energy sector was the biggest loser, with a 1 percent fall, as crude prices eased.
Among other stocks, Celgene Corp fell 7.79 percent after activist investor Starboard Value LP said it will vote against drugmaker Bristol-Myers Squibb Co’s $74 billion acquisition of the biotech. Bristol-Myers was up about 2 percent.
Monster Beverage Corp jumped 10.42 percent, the most on the S&P, after the beverage maker beat Wall Street estimates for quarterly revenue and profit.
Declining issues outnumbered advancers for a 1.19-to-1 ratio on the NYSE and for a 1.22-to-1 ratio on the Nasdaq.
The S&P index recorded 37 new 52-week highs and two new lows, while the Nasdaq recorded 49 new highs and 28 new lows.
Reporting by Shreyashi Sanyal and Medha Singh in Bengaluru; Editing by Anil D’Silva and Sriraj Kalluvila
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