U.S. Stocks Down Following Disappointing Earnings Results

By Michael Wursthorn and Justin Yang Features Dow Jones Newswires

U.S. stocks fell Thursday, following some disappointing earnings results from retail and technology companies.

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The Dow Jones Industrial Average declined 124 points, or 0.6%, to 21901, while the S&P 500 shed 0.7%. The Nasdaq Composite was down 0.9%.

A day after some retailers helped U.S. stocks bounce back, brick-and-mortar stores were once again contributing to broader market declines.

Victoria's Secret parent L Brands was one of the worst-performing stocks in the S&P 500, falling nearly 10% after the company cut its forecast for the remainder of the year. Big-box retailer Wal-Mart Stores declined 2% after the company reported lower profit on higher same-store sales.

Mark Stoeckle, chief executive and senior portfolio manager of Adams Funds, said his firm owns shares of the retailer and believes its sales growth amid the industry's broader struggles makes it attractive.

The pullback "could be a good opportunity for people who don't own Wal-Mart," said Mr. Stoeckle.

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His firm also weighed adding to its Cisco position in a meeting Thursday morning, but executives felt it was competing against companies that showed better growth, he said. "Doing OK in an environment where you got too many opportunities isn't good enough," Mr. Stoeckle added.

Shares of Cisco Systems shed 4% after the company said revenue fell last quarter.

Tech shares, which have soared this year, declined broadly.

NetApp fell nearly 6% after the company issued sales guidance that fell on the low end of analyst projections even though it beat quarterly earnings expectations.

When shares fall after companies beat expectations, that could suggest some pockets of the market have reached a peak, some investors said.

"When good news isn't rewarded, that tends to give you pause," said Michael Scanlon, a portfolio manager at Manulife Asset Management.

Elsewhere around the world, stocks were mixed following the release of central-bank minutes in the U.S. and Europe.

The Stoxx Europe 600 fell 0.6% after a brief upward swing.

Minutes from the European Central Bank's latest meeting suggested the central bank is wary of pulling back too soon on its large bond-buying program, especially as inflation isn't yet at its target.

The Federal Reserve minutes, released Wednesday, showed disagreement over the timeline for future interest-rate increases in the U.S.

U.S. government bonds strengthened, sending the yield on the 10-year Treasury note down to 2.213%, according to Tradeweb, from 2.224% Wednesday.

An earlier decline in the dollar pressured stocks in Japan, with the Nikkei Stock Average falling 0.1%.

Write to Michael Wursthorn at Michael.Wursthorn@wsj.com

(END) Dow Jones Newswires

August 17, 2017 12:29 ET (16:29 GMT)