Stocks ended broadly lower on Wall Street, breaking a five-day winning streak for the S&P 500 index and more in Tuesday’s Stock Market Update.
Technology companies posted some of the biggest losses. Microsoft lost 1.3%.
Johnson & Johnson led health care stocks lower. The health care and pharmaceutical company beat Wall Street’s second quarter financial forecasts, but its full-year profit forecast remained mostly below analysts’ projections.
Some banks rose after reporting results that beat analysts’ forecasts. Goldman Sachs rose 1.8% and JPMorgan Chase rose 1.1%.
Energy companies also fell broadly.
A surprisingly good retail sales report for June had little impact on consumer product makers, though it did help push bond prices lower. The yield on the 10-year Treasury rose to 2.12%.
Industrial companies fared the best. Union Pacific rose 1.4% and 3M rose 2.1%.
The latest round of corporate financial reports ramps up this week and investors have low expectations. Wall Street is forecasting a 3% drop in profit for S&P 500 companies. It is set to be the first back-to-back quarterly decline in three years.
The influx of earnings reports are coming in ahead of a highly anticipated Federal Reserve meeting at the end of the month. Wall Street expects the central bank to lower interest rates to help secure U.S. economic growth threatened by a trade war with China.
STOCK MARKET UPDATE
KEEPING SCORE: The S&P 500 index slipped 10 points, or 0.3%, to 3,004. The Dow Jones Industrial Average fell 23 points, or 0.1%, to 27,335. The Nasdaq fell 35 points, or 0.4%, to 8,222.
Bond prices fell. The yield on the 10-year Treasury rose to 2.12%.
ANALYST’S TAKE: Investors are looking for reasons to remain cautious as companies release their most recent financial results and give forecasts for the remainder of the year, said Jack Ablin, chief investment officer for Cresset Wealth management.
It’s still early to tally results, but so far the share of companies beating profit forecasts has been high while many are reporting revenue shortfalls.
“That certainly doesn’t bode well for growth in the second half,” he said.
Investors are going to pay close attention to any second-half forecasts as companies continue to deal with trade uncertainties and the impact they could have on investments and expansion.
SOUR DOUGH: Domino’s Pizza fell 8.6% after the pizza chain fell far short of Wall Street forecasts for a key sales measure during the second quarter.
SHOCKING FORECAST: Arrow Electronics fell 1.7% after the company slashed its profit forecast for the second quarter because of weak demand. The electronics company also said it will close a unit that focuses on disposing of personal computers and other technology.
BURGER BOOST: Blue Apron surged 36% after the meal-kit company said it will start offering recipes with Beyond Meat’s plant-based food. The company will start offering the options in August. Despite the surge, Blue Apron is still down more than 90% from its initial public offering two years ago.
KEEP ON TRUCKIN’: JB Hunt Transport Services jumped 5.5% after the company beat Wall Street’s second quarter profit forecasts. The trucking and logistics company also told investors that it expects volume will pick up in the second half of the year. Several other trucking and cargo-related companies also made gains. Ryder System rose 3.7%, Old Dominion rose 3.2% and Union Pacific rose 1.4%.
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