U.S. Market Indexes Lower on Thursday

U.S. market indexes continued to report losses on Thursday as economic indicators continued to be weak. For the day the Dow Jones Industrial Average closed at 17,660.44, flat for the day with a positive 0.05 percent. The S&P 500 was also higher, closing at 2,050.61 for a gain of 0.51 points or 0.02 percent. The Nasdaq Composite closed lower for the day at 4,717.09 for a loss of 8.55 points or 0.18 percent.

Economic Indicators

 The week’s economic reports have been effecting market valuations negatively and combined with the most recent GDP reading of 0.5 percent for the first quarter are slightly changing the outlook for the second half of the year. As companies and businesses factor in a slightly weaker economy, valuations are falling.

Major economic reports for the week have shown the lower outlook. Specifically causing the market’s recent trend lower is the employment data. ADP’s report Wednesday on the private sector showed a lower increase in jobs and Thursday’s jobless claims data was higher than expected.

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DJIA and Large-Cap Stocks

The Dow Jones Industrial Average finished flat for the day. In the Dow Jones Industrial Average Caterpillar, Nike and Merck led the Index’s losses. Caterpillar was down -1.83 percent and Nike was down -1.66%. Merck was down -1.64 percent after reporting disappointing earnings before the market’s open. Revenue for the first quarter was $9.31 billion, missing estimates by $150 million and falling -1.2 percent below the comparable quarter. Earnings per share were $0.89, beating estimates by $0.04. All sectors were broadly lower for the day except healthcare and energy.

Earnings Reports

Tesla and Kraft Heinz both had earnings reports that affected market trading Thursday. Tesla reported earnings Wednesday with positive results. Revenue for the first quarter was on target with analysts’ expectations at $1.6 billion for a comparable quarter gain of 45.5 percent. Earnings per share were $0.57, beating analysts’ estimates by $0.01. In trading Thursday the stock was down about 5 percent after analysts reported doubts about the company’s ability to produce and sell its new car models.

Leading Warren Buffett and Berkshire Hathaway holding, Kraft Heinz reported earnings Wednesday after the closing bell. Revenue for the company was $6.57 billion, a decrease of 3.8 percent from the comparable quarter. Earnings per share were 73 cents. The stock was up about 4 percent on Thursday and investors are buying as the stock is expected to gain following numerous synergies from its recent merger.

Daily Market Movers

In trading Thursday, Apple continued to trade actively and continues to see high volatility following its earnings report last week which showed considerable weakness in its mobile and personal computer sales, also an issue for the technology industry overall.

Apache Corp. reported leading market gains on Thursday. The stock was up approximately 8 percent after the energy company reported decreasing losses and improvements in commodities production.

Small-Cap Stocks

In small-caps, the Russell 2000 followed the day’s trend lower closing at 1,108.64 for a loss of 4.50 points or -0.40 percent. Other small-cap indexes were also lower. The S&P 600 closed at 681.92 for a loss of -4.40 points or -0.64 percent. The Dow Jones Small-Cap Growth TSM Index closed at 6,797.98 for a loss of -23.26 points or -0.34 percent. The Dow Jones Small-Cap Value TSM closed at 8,094.31 for a loss of -22.31 points or -0.27 percent.

Other Notable Indexes

Other notable index closes included the S&P 400 Mid-Cap Index which closed at 8,094.31 for a loss of -22.31 points or -0.27 percent; the Russell 3000 closing at 1,205.59 for a loss of -1.77 points or -0.15 percent; and the Dow Jones U.S. Select Dividend Index which closed at 584.16 for a loss of -1.17 points or -0.20 percent.

Julie Young

julie@dowfutures.org

Julie Young is a Senior Market Reporter and Analyst

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