VOL. 41 | NO. 26 | Friday, June 30, 2017
Stocks held back by slumps for energy, auto parts companies
NEW YORK (AP) — U.S. stock indexes were mixed Wednesday as energy companies skidded along with oil prices, but technology stocks rose and reversed a portion of their recent losses.
After O'Reilly Automotive reported weak sales growth in the second quarter, the three biggest losers on the Standard & Poor's 500 index were all auto parts companies. Car makers slumped, too.
An eight-day rally in U.S. crude oil prices ended with a thud and energy companies took sharp losses. Retailers and small, domestically-focused companies also struggled.
Technology companies bucked the trend and finished higher. Those companies have hit a wall in the last month. Banks and industrial and health care companies also rose on another quiet day of trading after the Independence Day holiday.
The Federal Reserve is trying to decide when it will start letting its $4.5 trillion bond portfolio shrink. Some Fed officials want to announce the start of that process within a few months, according to minutes from the central bank's June meeting, while others want to wait longer.
"The Fed seems to be a little bit divided over what it's going to do," said Doug Burtnick, deputy head of North American equities for Aberdeen Asset Management. He said that division makes investors put more emphasis on economic reports and other data.
"You're going to see a lot of pieces as early as next week because that's when you're going to start seeing a lot of earnings reports from banks," Burtnick added, and Wall Street will get a clearer view of how much money banks are lending.
The Standard & Poor's 500 index added 4.55 points, or 0.2 percent, to 2,432.54. The Dow Jones industrial average slid 1.10 points to 21,478.17. Nasdaq composite rose 40.80 points, or 0.7 percent, to 6,150.86. The Russell 2000 index of smaller-company stocks sank 6.54 points, or 0.5 percent, to 1,420.15.
Benchmark U.S. crude dropped $1.94, or 4.1 percent, to $45.13 a barrel in New York. Brent crude, used to price international oils, sank $1.82, or 3.7 percent, to $47.79 a barrel in London. U.S. crude reached an annual low in late June, and then jumped 11 percent over the next eight trading days.
Hess fell $2.06, or 4.5 percent, to $43.36 and Exxon Mobil shed $1.25, or 1.5 percent, to $80.85.
O'Reilly Automotive said sales were sluggish at its older locations over the last three months because of weak demand and the effects of a mild winter. Its stock lost $41.64, or 18.9 percent, to $178.77.
Advance Auto Parts gave up $13.20, or 11.1 percent, to $105.21 and AutoZone slid $54.88, or 9.6 percent, to $516.83. Those three companies have each plunged more than 30 percent this year as investors worry about the effects of slowing car sales.
Tesla took its biggest loss in a year after as investors were disappointed with the company's second-quarter production and delivery totals. The electric car maker's stock dropped $25.53, or 7.2 percent, to $327.09.
Elsewhere Ford declined 26 cents, or 2.2 percent, to $11.30 while General Motors sagged 56 cents, or 1.6 percent, to $35.01. Automakers had rallied Monday after they reported their monthly sales.
Payment processor Vantiv will buy the U.K.'s Worldpay for about $10 billion. Worldpay allows businesses to accept credit cards and online payments, and it released a statement Wednesday saying the companies agreed on the key terms of an acquisition. Vantiv stock retreated $1.49, or 2.4 percent, to $61.02. Payment technology companies Square and PayPal both climbed.
Monogram Residential, which owns and operates luxury apartment communities, climbed after it agreed to be bought by real estate company Greystar and a group of investors. The deal values Monogram at $12 a share, or about $2 billion. Monogram stock added $2.09, or 21.3 percent, to $11.89.
Technology companies did relatively well, although they have taken sharp losses over the last month. Chinese e-commerce company Baidu rose $3.86, or 2.1 percent, to $183.83 and chipmaker Nvidia gained $3.72, or 2.7 percent, to $143.05. The companies said they will work together on a group of projects intended to bring artificial intelligence technology to cloud competing, autonomous cars and home assistants.
In other energy trading, wholesale gasoline fell 3 cents, or 2.1 percent, to $1.50 a gallon. Heating oil shed 3 cents, or 2.3 percent, to $1.48 a gallon. Natural gas slumped 11 cents, or 3.8 percent, to $2.84 per 1,000 cubic feet.
Bond prices edged higher. The yield on the 10-year Treasury note dipped to 2.33 percent from 2.35 percent late Monday.
Gold rose $2.50 to $1,221.70 an ounce. Silver fell 20 cents to $15.90 an ounce. Copper lost 3 cents to $2.66 a pound.
The dollar declined to 113.35 yen from 113.39 yen. The euro fell to $1.1340 from $1.1358.
The CAC 40 of France, the DAX in Germany and Britain's FTSE 100 each rose 0.1 percent. Japan's benchmark Nikkei 225 index gained 0.3 percent while the Kospi in South Korea added 0.3 percent. Hong Kong's Hang Seng rose 0.5 percent.
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AP Markets Writer Marley Jay can be reached at http://twitter.com/MarleyJayAP His work can be found at https://apnews.com/search/marley%20jay