The Dow ended in negative territory for the second-straight
day while the S&P 500 and Nasdaq managed positive closes. As
expected, earnings numbers were the dominating factor behind
markets' movement and IBM's lower-than-expected revenues dragged
the blue-chip index lower. Separately, positive numbers from
Norfolk Southern and TE Connectivity boosted S&P 500. The
tech-laden Nasdaq hit its highest level since 2000.
For a look at the issues currently facing the markets, make sure
to read today's
Ahead of Wall Street
The Dow Jones Industrial Average dropped 0.3% to close at
16,373.34. The Standard & Poor 500 (S&P 500) edged up
0.1% to finish yesterday's trading session at 1,844.86. The
tech-laden Nasdaq Composite Index closed at 4,243, reflecting
gains of 0.4%. The fear-gauge CBOE Volatility Index (VIX) dropped
0.2% to settle at 12.84. Composite volume on the New York Stock
Exchange was 3.38 billion. Advancers outran the decliners as for
63% stocks that gained, 34% stocks declined.
The Dow dropped yesterday largely due to International Business
Machines Corporation's (IBM) dismal revenues. IBM reported
fourth-quarter revenues of $27.70 billion that lagged the Street
estimates. Revenues were also down 5.5% from the year-ago
quarter. On constant currency (cc) basis, revenues declined 3.0%
from the year-ago quarter.
Shares of IBM slumped 3.3%. It is the second-highest priced
component in the Dow and thus the decline dragged the broader
index along with it to the red zone. Separately, Coach, Inc.
) tanked 6% after an earnings miss. It reported earnings of $1.06
a share, well short of the consensus estimate of $1.11. Moreover,
earnings were down 13.8% year on year.
Coach was the biggest loser among the S&P 500 stocks, but the
index still managed a finish in the green primarily aided by
Norfolk Southern Corporation (NYSE:
). Shares of Norfolk jumped 4.8% after its fourth quarter profit
jumped 24%, which also outpaced Street estimates. United
Technologies Corp. (NYSE:
) too reported better-than-expected earnings and its shares
inched up almost a percent.
The day lacked any other major action and there was no key
economic data that could move the markets. Benchmarks traded in a
narrow range as investors kept searching for clarity on the
Meanwhile, Nasdaq climbed to its best level since July 17, 2000.
The tech-heavy index has ended in the green in five of the last
six trading sessions. Talking of individual benchmarks, the Dow
seems to be out of favor this week. The two trading sessions of
this week so far saw the Dow ending up on the losing side, while
others gained. The Dow is down 0.5% so far this week. The S&P
500 and Nasdaq are up 0.3% and 1.1%, respectively.
The Dow's finish in the red on both these days was due to
earnings results and forecasts. Dow components Verizon
Communications Inc. (NYSE:
), The Travelers Companies, Inc. (NYSE:
) and Johnson & Johnson (NYSE:
) had dragged the blue-chip index lower on Tuesday.
The Dow's dismal run this week is in sharp contrast to its 0.1%
weekly rise last week, which was also the first weekly gain of
the year. In fact, the Dow was the lone weekly gainer last week
as the S&P 500 and Nasdaq closed the week with losses of 0.2%
and 0.6%, respectively. However, this week the Dow's fortunes
have taken a completely different turn.
COACH INC (COH): Free Stock Analysis Report
JOHNSON & JOHNS (JNJ): Free Stock Analysis
NORFOLK SOUTHRN (NSC): Free Stock Analysis
TRAVELERS COS (TRV): Free Stock Analysis
UTD TECHS CORP (UTX): Free Stock Analysis
VERIZON COMM (VZ): Free Stock Analysis Report
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