Stock Market News For July 24, 2017
Zacks Investment Research | Jul 23, 2017 10:49PM ET
Benchmarks ended in the red on Friday after General Electric posted a decline in second-quarter earnings and revenues. Furthermore, decline in oil prices adversely affected energy shares, which in turn weighed on the broader markets. For the week, the S&P 500 and the Nasdaq closed in the green, but, the Dow finished in the red.
The Dow Jones Industrial Average (DJIA) declined 0.2% or 31.71 points, closing at 21,580.07. The S&P 500 Index (INX) fell a paltry 0.04%, sliding by 0.91 points to close at 2,472.54. This apart, the Nasdaq Composite Index (IXIC) closed 6,387.75, dropping 2.25 points and falling by a meager 0.04%. A total of around 5.73 billion shares were traded on Friday, lower than the last 20-session average of 6.31 billion shares. Declining issues outnumbered advancers on the NYSE by a 1.09-to-1 ratio.
General Electric’s Q2 Results Disappoints
General Electric (NYSE:GE) reported second-quarter 2017 earnings per share of 15 cents, less than 36 cents a share in the year-ago quarter. Revenues, meanwhile, have plummeted 12% year over year to $29,558 million. The industrial giant mentioned that it was just be able to reach the lower range of the initial forecast for the second-quarter. This certainly hasn’t gone down too well with the investors.
The Company’s more focus on the industrial businesses and less on its existing home appliances business has dwindled the company’s cash flow from operations last year by 67% to $3.6 billion this year. The company reported a slump in its shares by an astounding 5.4% on Friday and 18% so far this year.
Energy Sector Bleeds as Oil Prices Tank
As per Petro-Logistics, OPEC is expected to increase crude production by 145,000 barrels per day (bpd) this month. Such expectations of an increase in production level amid oversupply concerns have dragged oil prices down. The WTI Crude Oil and the Brent Crude Oil declined by $1.15 to $45.77 a barrel and $1.24 to $48.06 a barrel, respectively.
Decline in oil prices had a negative impact on energy shares. The broader Energy Select Sector SPDR (XLE (NYSE:XLE)) decreased almost 1%. Dow components Exxon Mobil Corporation (NYSE:XOM) and Chevron Corporation (NYSE:CVX) ended in the red.
Weekly Results – Mixed
For the week, the S&P 500 and the Nasdaq gained 0.5% and 1.2%, respectively. However, the blue-chip index fell 0.3%. The growth in the S&P 500 and Nasdaq was primarily supported by Microsoft’s upbeat Q2 results. Also broad-based gain in the biotech stocks coupled with Netflix’s solid quarterly earnings result helped the indexes close higher. Furthermore, Morgan Stanley (NYSE:MS) reported upbeat earnings primarily from its trading and wealth management businesses which also boosted investor sentiment. But, dismal performance by IBM (NYSE:IBM) and Goldman Sachs (NYSE:GS) weighed on the Dow. Again, the Amazon-Sears deal adversely affected Home Depot Inc (NYSE:HD)., which in turn weighed on the Dow.
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