Jobless claims fall by 12,000 in latest week
U.S. stocks fell on Thursday, with losses accelerating in late-morning trade, led by tech following disappointing results from Cisco, and lackluster performance in a Wal-Mart Stores unit.
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The Dow Jones Industrial Average fell 100 points, or 0.5%, to 21,925. The S&P 500 fell 12 points, or 0.5%, at 2,456, and the Nasdaq Composite Index shed 46 points, or 0.7%, to 6,297. All three benchmarks were off their lows of the day, however.
Still, Thursday's decline comes amid a broader uptrend for equities. The Dow is coming off a four-day string of gains, and it has risen in 14 of the past 18 trading days.
Cisco Systems Inc.(CSCO) lost 3.8% after the networking-equipment company late Wednesday reported earnings that missed forecasts (http://www.marketwatch.com/story/cisco-shares-fall-after-company-predicts-another-drop-in-sales-2017-08-16) and predicted a drop in revenue next quarter. The stock was one of the biggest decliners in the S&P, and it pressured the tech sector, which dropped 0.8% on the day as the market's biggest industry decliner.
Separately, retail giant Wal-Mart Stores Inc. (WMT) fell 2% after its results, which included lower-than-expected sales from its Sam's Club division (http://www.marketwatch.com/story/wal-mart-earnings-revenue-beat-estimates-2017-08-17). Thursday marked the biggest one-day percentage drop for the stock since June, though it remains up 13% for the year, ahead of the broader market.
"Cisco is in the midst of a turnaround, and it is showing very slow progress in that, while Wal-Mart has had something like 12 straight quarters of revenue growth, which led to expectations getting a little ahead of themselves. They're just taking a little bit of a step back, and so is the market," said Mark Spellman, portfolio manager at Alpine Funds, which has a total of $3.8 billion in assets.
"Ultimately I think the trends in the market remain constructive: the dollar is low, overseas economies are growing, and when I look for things that would get me worried I don't see them occurring."
The day's losses were broad, with 10 of the 11 primary S&P 500 sectors in the red. The only group to rise, real estate, was up less than 0.1% on the day.
The equity market was also digesting minutes from the Federal Reserve's July meeting, as well as President Donald Trump's disbanding of a pair of his business advisory panels (http://www.marketwatch.com/story/trump-business-councils-disband-amid-wave-of-ceo-exits-2017-08-16), which could underscores the president's challenges in promoting his Wall Street-friendly policies.
Trump has faced a furor after he repeatedly blamed "both sides" for violence last weekend at a white-supremacist rally in Charlottesville, Va.
Overall, stock benchmarks have lost some momentum after Fed minutes were read as dovish, lowering expectations of another rate increase this year.
"There's no direct market impact in what Trump has done recently, but if things continue to be so polarized that his agenda is completely dead on arrival, that would have a negative impact," Spellman said.
Fed in focus: The dollar on Wednesday declined after Fed minutes from the July meeting (http://www.marketwatch.com/story/fed-eyes-september-debt-drawdown-some-want-patient-on-rates-2017-08-16) suggested the central bank is worried about sluggish inflation.
"This kind of uncertainty leads to fresh doubts over whether the Fed will be able to raise rates again this year and clearly investors are growing more nervous," said Konstantinos Anthis, researcher at ADS Securities in a note.
"Looking ahead, the dollar's price action might be dictated by any fresh news on the North Korea front as President Trump is rumored to have asked his military advisers about credible military options," he added.
The greenback rebounded a little on Thursday, with the ICE Dollar Index up 0.2% at 93.769.
Read:Trump agrees to seek Seoul's OK before any action on North Korea, says President Moon (http://www.marketwatch.com/story/trump-agrees-to-seek-seouls-ok-before-any-action-on-north-korea-says-president-moon-2017-08-17)
Economic news: Initial jobless claims in the period running from Aug. 6 to Aug. 12 declined by 12,000 to 232,000, the Labor Department said Thursday.
Meanwhile, Philly Fed's manufacturing index (http://www.marketwatch.com/story/philadelphia-fed-factory-gauge-eases-but-hints-at-future-strength-in-august-2017-08-17) for August came in at 18.9, compared with a reading of 17.0 expected by economists polled by MarketWatch and 19.5 in the prior period.
A reading off industrial production, which was released earlier than expected Thursday morning, missed expectations, rising by 0.2% in July, compared with expectations for a rise of 0.3% and 0.4% gain in the prior month.
See:MarketWatch's economic calendar (http://www.marketwatch.com/economy-politics/calendars/economic)
Stock movers:Alibaba Group Holding Ltd.(BABA) jumped 3.2% after the Chinese e-commerce giant reported earnings and sales above expectations (http://www.marketwatch.com/story/alibabas-stock-jumps-after-profit-revenue-rise-above-expectations-2017-08-17).
L Brands Inc. (LB) slumped 9.7% after the Victoria's Secret parent late Wednesday cut its forecast (http://www.marketwatch.com/story/victorias-secret-parent-l-brands-shares-fall-after-company-cuts-full-year-view-2017-08-16) for third-quarter and full-year earnings. The stock was the biggest percentage decliner on the S&P.
NetApp Inc.(NTAP) fell 5.9% despite reporting earnings that came in ahead of expectations (http://www.marketwatch.com/story/data-storage-company-netapp-shares-edge-up-on-first-quarter-earnings-beat-2017-08-16). The stock has gained nearly 40% over the past 12 months.
(http://www.marketwatch.com/story/wal-mart-earnings-some-analysts-say-traffic-has-fallen-others-say-it-has-grown-2017-08-14)After the market closes, Gap Inc.(GPS), Ross Stores Inc.(ROST), and Applied Materials Inc.(AMAT) are expected to report.
Other markets:Asia markets closed mixed (http://www.marketwatch.com/story/asian-stocks-broadly-bounce-higher-on-tech-gains-2017-08-16) as investors there digested the Fed minutes.
European markets (http://www.marketwatch.com/story/european-stocks-veer-lower-as-fed-rate-hike-doubts-hurt-bank-shares-2017-08-17) were broadly lower, after a three-day winning streak.
Oil prices (http://www.marketwatch.com/story/oil-prices-rebound-after-eia-fueled-selloff-2017-08-17) continued to fall, extending losses made Wednesday after data showed U.S. oil production has jumped to a more than two-year high. Most metals prices, including , traded in positive territory.
(END) Dow Jones Newswires
August 17, 2017 10:41 ET (14:41 GMT)