Dismal corporate earnings reports and lower oil prices dragged
the major indices into negative territory on Tuesday. Among the
S&P 500 industry groups, the technology sector gained the
most. Financials, followed by utilities stocks ended on the
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Ahead of Wall Street
The Dow Jones Industrial Average (DJI) declined 0.2% to close the
day at 15,750.67. The S&P 500 lost 0.2% to finish yesterday's
trading session at 1,767.69. The tech-laden Nasdaq Composite
Index increased marginally to end at 3,919.92. The fear-gauge
CBOE Volatility Index (VIX) gained almost 2.3% to settle at
12.82. Consolidated volumes on the New York Stock Exchange were
roughly 3.22 billion shares. This was below the five day average
closing volume of about 6.4 billion, as per BATS exchange data.
Declining stocks outnumbered the advancers. For the 61% that
declined, only 36% advanced.
NRG Energy Inc. (NYSE:
) was one of the biggest losers in the S&P 500 index
yesterday. The stock fell by 98 cents, or 3.5%, to $27.06 per
share. The company posted earnings per share of 73 cents, falling
behind Street estimates and also behind the Zacks consensus
estimate of 80 cents per share. Additionally, the company lowered
its 2014 adjusted EBITDA to the range of $2.7-$2.9 billion
compared to $2.85-$3.05 billion previously.
News Corp (NASDAQ:
) also reported dismal numbers late on Monday which subsequently
impacted investors sentiment yesterday. Net income in the first
fiscal quarter, ending September, was $27 million, or 5 cents per
share, in comparison to $92 million, or 16 cents per share, a
year earlier.. The company's revenues dropped year on year, hurt
by lower advertising revenues. Earnings also missed the Street's
Separately, DISH Network Corp (NASDAQ:
) reported better-than-expected quarterly results and shares rose
6% to $50.35. The company reported net income of $315 million, or
68 cents per share, in the current quarter, in comparison to a
net loss of $158 million, or 35 cents per share, in the previous
year. D.R. Horton, Inc.'s (NYSE:
) fourth quarter earnings grew 33.3% year over year. Shares
jumped 4.7 % to $18.91, which made the stock the S&P 500's
biggest gainer in terms of percentage gains.
Markets were also affected by the 2% drop in oil prices yesterday
to a five-month low as the market expects a second increase in
domestic supplies. Energy stocks were affected widely, with
Pioneer Natural Resources (NYSE:
) dropping 3% and Chevron Corporation (NYSE:
) losing 0.9%. Other stocks such as Exxon Mobil Corporation
), Schlumberger Limited. (NYSE:
) and ConocoPhillips (NYSE:
) slipped 0.3%, 2.0% and 1.0% respectively.
Oil prices had skidded nearly 9% last month. The U.S. average
price paid for a gallon of gasoline dropped by a penny to $3.18
in January 2013, according to the American Automobile Association
(AAA). The price has declined by 6 cents from last week and is
down 26 cents from last year.
There were some positives for the market as well. US Airways
Group Inc. (NYSE:
) and American Airlines merged to become the world's largest
airline company. This was approved by the government after the
tow companies agreed to provide low cost airlines access to many
important U.S. airports, including New York and Washington.
This in turn helped, JetBlue Airways Corporation (NASDAQ:
) to gain 47 cents, or 6.1% to reach $8.16 per share. Southwest
Airlines Co. (NYSE:
) also 1.2 % in its share price to settle at $18.03 per share.
The members of the department of justice have named the
settlement a major uplift to the competition at the key major
Of the top ten S&P 500 industry groups, technology stocks
gained the most. The Technology SPDR (XLK) gained 0.27%. Stocks
such as Apple Inc. (NASDAQ:
), Google Inc. (NASDAQ:
), International Business Machines Corp. (NYSE:
), AT&T Inc. (NYSE:
), and Verizon Communications Inc. (NYSE:
) gained 0.2%, 0.1%, 0.1%, 0.4%, and 0.4%respectively.
The financial sector was the biggest loser among the S&P 500
industry groups and the Financial Sector SPDR (XLF) lost 0.9%.
Stocks such as Berkshire Hathaway Inc. (NYSE:BRK.B), Wells Fargo
& Co (NYSE:
), JPMorgan Chase & Co. (NYSE:
), Bank of America Corp (NYSE:
), and Citigroup Inc. (NYSE:
) slipped 1.3%, 1.1%, 0.2%, 0.6%, and 1.3%, respectively.