You are here
US: Weak earnings, Trump fears pressure stocks
[NEW YORK] The Dow retreated Tuesday as US stocks remained pressured following lacklustre earnings from ExxonMobil and uncertainty over the Trump growth agenda.
ExxonMobil missed expectations and shares fell 1.2 per cent after the company reported a 39.6 per cent drop in fourth-quarter earnings to US$1.7 billion.
Among those that dropped more than one per cent were JPMorgan Chase, Goldman Sachs and Caterpillar, blue-chip companies that had rallied after President Donald Trump's election sparked hopes of tax cuts, infrastructure spending and other growth policies.
Analysts said there is greater skepticism that Mr Trump and congressional Republicans will succeed in enacting their agenda following a stream of controversies in the administration's early days, most recently over the executive order on immigration.
The Dow Jones Industrial Average ended at 19,864.09, down 0.5 per cent and pulling back further from the historic 20,000 points level and the lowest in a week.
The broad-based S&P 500 slipped 0.1 per cent to 2,278.87, while the tech-rich Nasdaq Composite Index finished up a hair at 5,614.79.
"It's a combination of disappointing earnings, Trump worries and macro news," said Peter Cardillo, chief market economist at First Standard Financial.
UPS slumped 6.8 per cent as it reported a loss of US$239 million in the fourth quarter and projected weaker-than-expected 2017 profits due in part to ramped-up capital investments to improve e-commerce business.
Sports apparel and shoe company Under Armour plunged 23.4 per cent after reporting earnings that missed expectations, and the departure of chief financial officer Chip Molloy due to personal reasons.
Harley-Davidson lost 1.5 per cent after offering a gloomy forecast due to sluggish demand in the United States. Deliveries slumped 12 per cent in the fourth quarter.
Pharmaceutical shares were mostly higher after a White House meeting of top executives with Mr Trump, who reiterated a pledge to lower drug prices, but also said he would work to slash regulations to streamline the drug-approval process.
Merck rose 0.9 per cent, Amgen 1.5 per cent and Mylan 3.3 per cent.
Investors were looking ahead to an earnings release later Tuesday from Apple, and to Wednesday's finale to a Federal Reserve monetary policy meeting.