Posted: Thursday, January 23rd 2014 at 1:20pm
Stocks fall on US earnings, weak China report
By The Associated Press
NEW YORK (AP) -- U.S. stocks are falling broadly Thursday after earnings and forecasts from several companies disappointed investors. A survey from China, a major driver of global growth, suggested that manufacturing in the world's second-largest economy was contracting.
KEEPING SCORE: The Dow Jones industrial average fell 170 points, or 1 percent, to 16,202 as of 1 p.m. Eastern time. The Standard & Poor's 500 lost 18 points, or 1 percent, to 1,827. The Nasdaq composite dropped 37 points, or 0.9 percent, to 4,206. Nine out of ten stocks in the S&P 500 index fell.
CHINA INDUSTRIAL: The preliminary reading of HSBC's purchasing managers' index for China dipped this month to 49.6, the lowest level since July. Numbers below 50 indicate contraction.
"Any kink in the growth story globally is going to give investors pause," said James Dunigan, chief investment strategist at PNC Wealth Management. "The market at these levels is a bit skittish."
WEAK RESULTS: Several U.S. companies fell after reporting their latest quarterly results, including KeyCorp, Johnson Controls and Jacobs Engineering. Each of those stocks were down 3 percent or more. United Continental fell $1.19, or 2.4 percent, to $47.99 after its prediction for revenue growth this quarter disappointed investors.
CEO OUT: American Eagle Outfitters dropped $1.36, or 9 percent, to $12.95 after the company announced the unexpected departure of its CEO, Robert Hanson. The teen retailer had reported disappointing sales over the holiday season.
PHONE FUMBLE: Nokia plunged 71 cents, or 9 percent, to $6.99 after posting a fourth-quarter loss on falling handset sales. The mobile phone business is part of the device and services unit that the Finnish company has agreed to sell to Microsoft.
WATCHING NETFLIX: Netflix jumped $48.16, or 14 percent, to $381.89, the biggest gain in the S&P 500. After the closing bell Wednesday, the streaming video company reported fourth-quarter earnings had climbed six-fold and that it had added 2.3 million subscribers during the period.
MOVING FREIGHT: Union Pacific rose $5.01, or 3 percent, to $173.51 after reporting a 13 percent jump in fourth-quarter earnings that beat analyst forecasts.
TREASURIES AND COMMODITIES: Bond prices rose. The yield on the 10-year Treasury note fell to 2.79 percent from 2.86 percent on Wednesday. The price of oil rose 98 cents, or 1 percent, to $97.71 a barrel. Gold was up $23.70, or 1.9 percent, to $1,262.30 an ounce.
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