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US: Wall St slips on mixed bag of earnings
[NEW YORK] US stocks slipped in choppy trading on Wednesday with traders focusing on earnings, as declines including in Boeing and Chipotle outweighed gains in McDonald's and Coca-Cola.
Boeing fell 1.7 per cent to US$150.77 after reporting revenue that fell short of expectations, while Chipotle fell 7.6 per cent to US$639.98 a day after it reported the slowest same-restaurant sales growth in five quarters.
Of the S&P 500 companies that have reported so far this earnings season, 71.9 per cent posted earnings above analyst expectations. However, just 42.1 per cent have beaten revenue expectations, compared with a 58 beat over the last four quarters.
McDonald's rose 4.3 per cent to $98.97 despite a revenue drop, while Coca-Cola rose 0.9 per cent to $41.15 after it reported a rise in revenue for the first time in nine quarters.
"Equity investors have been selling this year while credit investors have been investing aggressively," said Brian Reynolds, chief market strategist at Rosenblatt Securities in New York.
"That tells me that in the second half of the earnings season we're going to see more buybacks and more mergers in response to the selloff as CEOs are under pressure to jack up their stock prices."
At 10:25 am EDT (1425 GMT) the Dow Jones industrial average was down 30 points, or 0.17 per cent, at 17,919.59, the S&P 500 was down 2.51 points, or 0.12 per cent, at 2,094.78 and the Nasdaq Composite was down 13.96 points, or 0.28 per cent, at 5,000.14.
Various companies have cited the negative effect of the strong dollar for cutting their forecasts. The dollar gained about 23 per cent against a basket of major currencies over the financial year ended March 31, hurting companies with large overseas operations.
Visa rose 4.1 per cent to US$68.03, while MasterCard was up 3.4 per cent at US$90.76 after China announced it will open up its market for clearing domestic bank card transactions, a move that should allow foreign players direct access to a market valued at US$6.84 trillion.
Angie's List jumped 14 per cent to US$7.01 and was among the most actively traded stocks after the company posted a surprise profit.
Declining issues outnumbered advancing ones on the NYSE by 1,739 to 1,028, for a 1.69-to-1 ratio on the downside; on the Nasdaq, 1,725 issues fell and 763 advanced for a 2.26-to-1 ratio favouring decliners.
The benchmark S&P 500 index was posting 17 new 52-week highs and no new lows; the Nasdaq Composite was recording 51 new highs and 22 new lows.
Companies reporting results after the market close on Wednesday include AT&T, Facebook and EBay.