Wall Street mixed; Apple impresses, Twitter disappoints

Reuters Updated - January 17, 2018 at 11:48 PM.

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US stocks were mixed on Tuesday as Federal Reserve policymakers kicked off a two-day interest rate meeting and investors braced for quarterly scorecards from Apple and Twitter.

Choppy stock trading followed a recent rally to consecutive record highs on the S&P 500 that has stretched price-to-earnings multiples to levels that some investors say presumes that companies will beat second-quarter estimates.

Five of the 10 major S&P sectors rose, while a 1.49 per cent drop in the telecom services index weighed heavily.

Verizon Communications fell 1.9 per cent after subscriber numbers fell below estimates.

Caterpillar's shares jumped 5.16 per cent to touch a year high after quarterly earnings beat expectations.

The Federal Reserve began a two-day meeting and while it is not expected to raise US interest rates, investors will be watching for hints about when the US central bank might make a move.

A set of strong economic data, including Tuesday's housing report, could strengthen the case for the Fed to raise rates earlier than the market anticipates.

“The real thing I'm going to be looking for is, is there a tip of the hat to a potential rate increase in September?,” said Brad McMillan, chief investment officer at Commonwealth Financial Network.

The Dow Jones industrial average dipped 0.1 per cent to end at 18,473.75 and the S&P 500 edged up 0.03 per cent to 2,169.18 after spending much of the day at a loss. The Nasdaq Composite added 0.24 per cent to 5,110.05.

After investors shrugged off Britain's unexpected vote in late June to leave the European Union, the S&P 500 rallied and is up 6 per cent year to date.

Almost a third of the way into second-quarter reports, S&P 500 companies overall are expected to see earnings dip 3.5 per cent, not as bad as the 4.5 per cent dip predicted at the start of the month, according to Thomson Reuters I/B/E/S.

Shares of Apple , the world's largest publicly traded company, dipped 0.69 per cent ahead of its quarterly report after the bell.

In extended trade, Apple surged 4 per cent after the company reported more iPhone sales than expected for the June quarter.

Twitter slumped 9 percent after the social network reported its slowest quarterly revenue growth since going public in 2013.

Earlier, McDonald's sank 4.46 per cent after reporting worse-than-expected quarterly sales at established U.S. restaurants. The stock weighed the most on the Dow.

Texas Instruments jumped 7.85 per cent after its current-quarter forecast beat analysts' estimates. The stock provided the biggest boost to the S&P 500.

Advancing issues outnumbered declining ones on the NYSE by a 1.58-to-1 ratio; on Nasdaq, a 1.62-to-1 ratio favoured advancers.

The S&P 500 posted 53 new 52-week highs and no new lows; the Nasdaq Composite recorded 119 new highs and 25 new lows.

About 6.5 billion shares changed hands on US exchanges, below the nearly 6.8 billion daily average over the past 20 sessions.

Published on July 27, 2016 03:58