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Stocks gave up early gains to turn lower Tuesday as investors sifted through earnings from big banks and other blue chip companies, in the search for fresh indicators of how the banking sector and the economy as a whole are holding up amid slowdown worries.
How stocks are trading
- The Dow Jones Industrial Average DJIA was down 129 points, or 0.3%, at 33,857.
-
The S&P 500
SPX,
-0.06%
eased 2 points, or 0.07%, at 4,148. -
The Nasdaq Composite
COMP,
-0.07%
was down 9 points, or 0.08%, at 12,148.
All three major indexes rose around 0.3% on Monday.
What’s driving markets
Tuesday is a big day as the market readies for the still young earnings season to kick into high gear. But while stocks pushed higher during premarket trading, the market subsequently stalled and started slipping.
Companies presenting their numbers on Tuesday include Bank of America Corp.
BAC,
Goldman Sachs Group Inc.
GS,
Bank of New York Mellon Corp.
BK,
Johnson & Johnson
JNJ,
and Lockheed Martin Corp.
LMT,
After the closing bell, Netflix Inc.
NFLX,
will release its results.
Results so far have been generally well-received, though declines for Goldman and Johnson & Johnson weighed down the Dow. By midmorning, the three major stock benchmarks were in the red.
Generally upbeat results have helped the S&P 500 to hold near the top of the 3,800 to 4,200 range it has occupied for about five months as softer inflation data of late has also reduced concerns about faster Federal Reserve rate rises.
“The S&P 500 is approaching the highest levels reached in February, as the market focus is shifting back to economic and corporate data,” said Ipek Ozkardeskaya, senior analyst at Swissquote Bank.
“Stronger-than-expected earnings could give a hand to equity bulls,” she added but warned this could falter if recent signs of U.S. economic resilience pushed yields back higher.
And data out of China on Tuesday suggested an important growth driver of the global economy was improving, with GDP up 4.5% in the first quarter, boosted by increased consumption and retail sales, after authorities abruptly abandoned the stringent “zero-COVID” strategy.
But bearish pessimism looms. Fund managers struck the most downbeat mood so far this year, according to a Bank of America fund manager survey. Growth expectations are softening, even as the polled managers predict global inflation and short-term rates will ebb lower.
Read: The ‘fuel is there to blow the top off’ the stock market. Here’s what’s missing.
In other data beyond corporate earnings, March housing starts showed a 0.8% decline after a revised 7.3% increase in February. U.S. building permits fell 8.8% in the month. The decline was linked to a slowdown in apartment building construction.
Meanwhile, Fed Gov. Michelle Bowman is due to speak at 1 p.m. ET.
Companies in focus
- Bank of America shares were off more than 1% after trading higher in the premarket. The bank reported a beat on revenue and profit in its first quarter profits.
- Shares of Goldman Sachs were almost 2% lower as investors digest the bank’s results. Goldman’s first quarter revenue missed estimates, but net income beat expectations.
- Johnson & Johnson shares were down more than 2%. The consumer and pharmaceutical booked a multibillion charge to settle talc litigation claims — but the company also beat analyst estimates while lifting its quarterly dividend and raising it full-year guidance.
- Lockheed Martin shares were up almost 3% higher after first quarter earnings results. The defense and aerospace company beat expectations on earnings and sales.
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