| |
US Stocks Fall; Brent Oil Hits $107 04/23 15:22
U.S. stocks pulled back from their record heights on a shaky Wall Street
Thursday following mixed profit reports from Tesla and other big companies. Oil
prices, meanwhile, jumped on worries about what will happen next in the war
with Iran.
NEW YORK (AP) -- U.S. stocks pulled back from their record heights on a
shaky Wall Street Thursday following mixed profit reports from Tesla and other
big companies. Oil prices, meanwhile, jumped on worries about what will happen
next in the war with Iran.
The S&P 500 fell 0.4% and halted a weekslong rally that had erased all its
losses because of the war and then carried it to all-time highs. The Dow Jones
Industrial Average dipped 179 points, or 0.4%, while the Nasdaq composite
dropped 0.9% from its own record.
Tesla helped drag the market lower after sinking 3.6% even though it
reported better results for the latest quarter than analysts expected.
Investors focused instead on a big jump in Tesla's forecast for spending this
year, as it builds factories to make robots and other products.
"You should expect to see a very significant increase in capital
expenditures," Elon Musk told investors late Wednesday, "but I think well
justified for a substantially increased future revenue stream."
ServiceNow dropped even more, 17.7%, even though its results for the latest
quarter matched analysts' expectations. The company has been under pressure,
along with much of the broad software industry, because of worries that rivals
powered by artificial-intelligence technology could undercut its business.
In the oil market, prices leaped as uncertainty built about what will happen
with the Strait of Hormuz. A ceasefire is still in place between the United
States and Iran, but oil tankers in the Persian Gulf aren't able to get through
the narrow waterway off Iran's coast and deliver crude to customers.
The U.S. military on Thursday seized another tanker associated with the
smuggling of Iranian oil, a day after Iran's paramilitary Revolutionary Guards
took control of two vessels in the strait. President Donald Trump also said
Thursday he ordered the U.S. military to "shoot and kill" Iranian boats that
deploy mines to gum up traffic in the strait.
The price for a barrel of Brent crude to be delivered in June rose 3.1% to
settle at $105.07 and at one point topped $107. That peak coincided with a
sudden drawdown for stocks, and the S&P 500 fell as much as 1.3% before it
almost as instantly erased half the loss.
The price for a barrel of Brent to be delivered in July, which is the more
popular contract for traders, settled at $99.35 after getting as high as $101.
More expensive oil has hurt airlines in particular because of the industry's
big fuel bills, and stocks diverged in the industry following the latest profit
reports.
American Airlines Group rose 2.4% after reporting better profit and revenue
for the latest quarter than analysts expected. American said demand was strong
for flights, and it saw the nine best weeks for revenue intake in its 100-year
history.
Southwest Airlines lost 4.1% after reporting weaker quarterly results than
analysts expected. It said it would not give an updated forecast for profit
this year because of "the ongoing macroeconomic uncertainty."
Also on the losing end of Wall Street was IBM, which sank 8.3% despite
reporting better profit and revenue for the latest quarter than expected.
Investors focused on potentially discouraging numbers underneath the surface,
including decelerating growth in trends for its software business.
Paramount Skydance fell 4.5% after Warner Bros. Discovery shareholders
approved selling the business to Paramount. Warner Bros. Discovery sank 1.6%.
Texas Instruments helped limit Wall Street's losses after breezing past
analysts' expectations for profit in the latest quarter. CEO Haviv Ilan said
the semiconductor company is benefiting from growth led by industrial and data
center customers, and its 19.4% leap was the strongest force pushing upward on
the S&P 500.
All told, the S&P 500 fell 29.50 points to 7,108.40. The Dow Jones
Industrial Average dipped 179.71 to 49,310.32, and the Nasdaq composite sank
219.06 to 24,438.50.
In stock markets abroad, indexes fell across much of Europe and Asia. Hong
Kong's Hang Seng fell 0.9%, and Japan's Nikkei 225 sank 0.7% for two of the
bigger losses.
South Korea's Kospi climbed 0.9% after the government reported
better-than-expected economic growth for the start of the year, boosted by
strong exports, particularly of computer chips used in the AI boom.
Semiconductor supplier SK Hynix said its revenue for the latest quarter jumped
more than analysts expected largely because of AI-related demand.
In the bond market, the yield on the 10-year Treasury erased an early dip
and rose to 4.32% from 4.30% late Wednesday as oil prices accelerated.
A report in the morning said slightly more U.S. workers applied for
unemployment benefits last week, but the number is still at a historically
healthy level. A separate, preliminary report on U.S. business output from S&P
Global also suggested growth is improving a bit from its near-stagnation seen
in March.
|
|
