October 20, 2016 / 3:27 PM / 2 years ago

US STOCKS-Wall St falls as weak earnings dent optimism; oil drags

* Oil prices fall 2.4 pct, hits energy stocks

* Verizon, Travelers fall on weak reports

* AmEx up on strong results, boosts S&P and Dow

* EBay, Microsoft drag on technology sector

* Indexes down: Dow 0.36 pct, S&P 0.42 pct, Nasdaq 0.48 pct (Adds details, comments, updates prices)

By Yashaswini Swamynathan

Oct 20 (Reuters) - U.S. stocks fell sharply on Thursday as weak earnings from index heavyweights such as Verizon dented optimism about the earnings season and as a drop in oil prices weighed on energy stocks.

Verizon fell 2.3 percent, dragging the most on the S&P, after the wireless carrier reported a drop in quarterly revenue. Rival AT&T fell 2 percent.

The telecom services sector tumbled 1.9 percent, the most among the 11 major S&P 500 indexes.

The next biggest loser was the energy index, which was off 1.1 percent. Oil prices fell the most in four weeks on profit taking and the dollar’s rise.

The biggest drag however was the technology sectors’ 0.65 percent decline. Earnings of tech companies have been a spot of bother in the latest quarter.

EBay tumbled 10 percent after a disappointing current-quarter forecast. Microsoft, scheduled to report after the bell, fell 1.3 percent, weighing the most on the Nasdaq.

The top drag on the Dow was Travelers, which fell 4.28 percent after the insurer posted a steep drop in profit.

The mostly dour reports could dent the chances of S&P 500 companies having snapped a four-quarter earnings recession in the third quarter.

Helping the Dow and the S&P cut some losses was American Express’s 8.9 percent jump following its strong results and forecast.

Of the 70 S&P 500 companies that had reported results until Wednesday, about 80 percent beat profit estimates. Earnings are expected to have risen 0.5 percent in the quarter, according to Thomson Reuters I/B/E/S.

“There hasn’t been a rash of earnings misses, but when you are in-line and you have lukewarm forward guidance, the market doesn’t get very excited about that, especially considering that expectations are already low,” said Chris Zaccarelli, Chief Investment Officer for Cornerstone Financial Partners.

“With valuations on the higher end of historical averages, you want to see strong earnings across the board and I think the market’s a little bit underwhelmed right now.”

At 10:52 a.m. ET (1452 GMT), the Dow Jones Industrial Average was down 66.19 points, or 0.36 percent, at 18,136.43.

The S&P 500 was down 9.02 points, or 0.42 percent, at 2,135.27 and the Nasdaq Composite was down 25.11 points, or 0.48 percent, at 5,221.31.

Nine of the 11 major S&P 500 indexes were lower, with the healthcare and utilities sectors posting marginal gains.

Stock futures were higher earlier in the day after a poll showed more people perceived Hillary Clinton won the third and final U.S. presidential debate than her rival Donald Trump.

Declining issues outnumbered advancing ones on the NYSE by 1,960 to 799. On the Nasdaq, 1,551 issues fell and 910 advanced.

The S&P 500 index showed four new 52-week highs and two new lows, while the Nasdaq recorded 36 new highs and 38 new lows. (Reporting by Yashaswini Swamynathan in Bengaluru; Editing by Savio D’Souza)

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below