×
Home Companies Industry Politics Money Opinion LoungeMultimedia Science Education Sports TechnologyConsumerSpecialsMint on Sunday
×

Dow, S&P dip as F5 view hits Nasdaq, Google up late

Dow, S&P dip as F5 view hits Nasdaq, Google up late
Comment E-mail Print Share
First Published: Fri, Jan 21 2011. 09 01 AM IST
Updated: Fri, Jan 21 2011. 09 01 AM IST
New York: Stocks fell on Thursday as lackluster tech and materials earnings failed to live up to heightened expectations, threatening to short-circuit a seven-week run.
Declines were milder than on Wednesday, when a sharp drop pulled the market off two-year highs. Morgan Stanley posted stronger-than-expected revenue to help the banking sector rise modestly. Morgan Stanley rose 4.6% to $29.02.
But F5 Networks plunged 21.4% to $109.15 and pulled the Nasdaq lower after the leader in the network optimization market forecast weak second-quarter revenue.
“The tug of war continued during the course of the day with techs and financials -- the two big behemoths in terms of bellwethers for the market -- slugging it out all day,” said Joseph Benanti, managing director of Rosenblatt Securities in New York.
“We had a lot of movement on hot news that will subside. Cloud stocks are important, but they are not going to drive all technology. And the financials are a bigger sector to follow and are starting to hold their own.”
Google Inc rose 2.2% to $640.79 in extended trade after the company reported better-than-expected net revenue for its fourth quarter. The world’s No. 1 Internet search engine, whose stock is among the most closely watched, also said co-founder Larry Page will replace Eric Schmidt in April as chief executive.
Freeport-McMoRan Copper & Gold Inc lost 3.7% to $110.90 after the copper producer trimmed its sales forecast and said costs would rise. Natural resources stocks also came under pressure after data showing high growth in China stoked fears the country may need to tighten credit in order to check inflation.
The Dow Jones industrial average dipped 2.49 points, or 0.02%, to 11,822.80. The Standard & Poor’s 500 Index fell 1.66 points, or 0.13%, to 1,280.26. The Nasdaq Composite Index lost 21.07 points, or 0.77%, to 2,704.29.
Blowing off positive data
Underscoring how overbought the market has become in recent weeks, stocks failed to react to positive jobs and housing market data that pointed to a strengthening recovery.
US crude oil futures posted a third consecutive lower settlement. The expiring February crude contract settled at $88.86 per barrel, down 2.2%, which was the biggest percentage slide since prices fell 2.37% on 4 January.
Alcoa Inc shed 0.5% to $15.98, while Exxon Mobil Corp slipped 0.6% to $77.75.
In another example of how investors reacted to the market’s elevated earnings expectations, Parker Hannifin Corp shares fell 6.1% to $85.51. The company, which makes industrial control systems, beat earnings forecasts, but the stock slid as investors faulted the size of the beat.
The latest data indicated that two weak spots in the US economy -- housing and jobs -- appear to be on the mend. US existing home sales jumped more than expected in December despite bad weather as the housing sector struggled to recover from a severe slump, according to a report from the National Association of Realtors.
Earlier in the day, the Labor Department reported that US initial jobless claims posted their biggest weekly decline in nearly a year.
Volume was above average with about 9.04 billion shares traded on the New York Stock Exchange, the American Stock Exchange and Nasdaq, topping last year’s estimated daily average of 8.47 billion.
Declining stocks outnumbered advancing ones on the NYSE by a ratio of 18 to 11, while on the Nasdaq, 19 stocks fell for every seven that rose.
Comment E-mail Print Share
First Published: Fri, Jan 21 2011. 09 01 AM IST