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US: Dow holds on for third straight record finish
[NEW YORK] The blue-chip Dow Jones Industrial Average held on to slim gains Friday to close at a third consecutive record despite some disappointments in earnings.
But the broader S&P 500 and the tech-heavy Nasdaq ended lower, capping a busy week of earnings that had driven Wall Street to new heights.
The Dow had gained 0.2 per cent to end the week at 21,830.31. But the S&P and Nasdaq were both down 0.1 per cent to close at 2,472.10 and 6,374.68, respectively, leaving the two indices lower for the week.
Stocks recovered somewhat from early losses toward midday but were held down by negative investor reactions to earnings from Amazon, ExxonMobil and Starbucks.
Tobacco companies also saw their shares nosedive after the FDA announced a new drive to reduce the amount of addictive nicotine in cigarettes.
"It was a pretty good week, obviously ending on a sour note," Chris Low of FTN Financial told AFP.
"We started the week with better than expected earnings form the big banks. At the end of the week, we had Amazon."
The online retail behemoth fell 2.5 per cent after the company reported a dip in profits but a big boost in sales.
But Mr Low said the Nasdaq selloff was not limited to Amazon as some investors may be rethinking their views of Facebook and other tech giants.
Starbucks also fell 9.2 per cent on the Nasdaq.
On the Dow, the oil supermajors were split, with ExxonMobil falling 1.5 per cent as second quarter profits surged but missed expectations as output fell, while Chevron rose 1.8 per cent after it reported better-than-expected profit.
Investors also were digesting the latest US economic data, as GDP growth more than doubled in the second quarter at 2.6 per cent growth but was below analyst expectations.
"Investors are in a wait and see approach as they continue to digest or wait for more economic data," Adam Sarhan, CEO of 50 Park Investments.
Republicans' failure to repeal the health care law could signal trouble for any future economic stimulus package, he said.
"If they encounter problems like they did with the health care bill, that could definitely be negative for stocks."