Dow recovers its losses by the closing bell

Tesla was a top decliner of the day after its CEO's comments to investors on a earnings call

Bull and bear figures
The Nasdaq and S&P 500 were down slightly
  • Dow recovers 400-point loss

  • Nasdaq ends the day lower despite upbeat tech earnings 

  • Tesla shares still falling after CEO's earnings call comments

  • Vulcan Materials shares jump after strong earnings

The U.S. benchmarks had a better day than yesterday with the Dow inching higher by the closing bell.

The Dow Jones recovered a 400-point loss, up by around 5 points.

The Nasdaq and the S&P 500 were both down slightly.

The TSX fell slightly as well, weighed down by the energy sector.

Fortune 500 health care company Cardinal Health Inc (NYSE:CAH) was a top decliner of the day, hitting its 52-week low. The Ohio-based company saw it shares drop more than 20% to US$50.96 after reporting a lower-than-expected quarterly profit and slashing its annual earnings forecast.

Tesla Inc (NASDAQ:TSLA) shares fell more than 5% to US$284.45 by the closing bell after reporting its first-quarter earnings. Although the electric car company had a narrower-than-expected loss, CEO Elon Musk told investors during an earnings call to stay away from the stock if they can’t handle volatility.

Vulcan Materials Company (NYSE:VMC) was a top gainer of the day with its shares jumping more than 7% to US$122.20. The construction company beat Wall Street estimates on both earnings and revenue.

Marathon Oil Corporation (NYSE:MRO) shares were up more than 6% to US$19.44 following its first quarter earnings report. The Texas-based energy company beat estimates on earnings and revenue, crediting higher production in the U.S.

Afternoon trade:

The Dow marched back into the green despite the sabre-rattling between the U.S. and China as trade delegates from both countries kicked off talks in Beijing.

The markets had low expectations from the confabulation in Beijing designed to avert  a full-blown U.S.-China trade war.

The Dow Jones Industrial Average was up 14 points, or 0.06% at 23,910, after sinking by as many as 360 points in late-morning trade.

The S&P 500 index was down 0.24% to 2,629 points.

Rather than rally on the back of upbeat tech results, the Nasdaq also sulked lower by 0.18% to 7,087.

Square Inc. (NYSE:SQ) fell 1% after investors soured on the fintech after digesting that its bitcoin business is going nowhere.

Kush Bottles Inc (OTCMKTS:KSHB) which has just completed a US$15mln acquisition of Denver-based Summit Innovations was up over 1% to US$5.65.

OraSure Technologies Inc. (NASDAQ:OSUR) plunged 13.4% to US$15.43 after the Pennsylvania diagnostic maker reported a first quarter loss of US$2.1mln, after reporting a profit in the same period a year earlier.

Morning trade: 

US indices slipped in early trade Thursday as investors shifted their attention to concerns about the outlook for trade and away from corporate earnings reports and the Federal Reserve meeting.

Shortly after the opening bell, the Dow had lost 161 points to trade at 23,764 while the S&P 500 had fallen 15 points to 2,621 and the tech-heavy Nasdaq shed 31 points to 7,069. Up in Toronto, the TSX was also down 6 points at 15,622.

Trade talks between the US and China are pushing down the yield on ten-year US Treasuries, which has fallen 2 basis points to 2.95%.

Steve Mnuchin, the US Treasury secretary, is part of a group of White House officials who are in Beijing for a meeting with Chinese Vice Premier Liu to discuss trade between the two countries.

The euro, meanwhile, jumped against the dollar despite reports of inflation weakening on the Continent and the pound was also up against the dollar at US$1.3589.

Cardinal Health shares plunged 15.7% to US$54.48 after the group missed its third-quarter profit estimates and slashed its earnings guidance.

Tesla (NASDAQ:TSLA) shares also dropped 6.9% in the wake of Elon Musk’s bizarre earnings conference call late Wednesday in which he took aim at analysts and the media.

Marathon Oil’s shares (NYSE:MRO), meanwhile, climbed 6% on strong earnings results due to the strengthening price of crude oil.

Also trading higher in early trade was Kraft Heinz (NASDAQ:KHC), the maker of Heinz ketchup, which climbed almost 4% after posting first-quarter profits which exceeded market expectations.


Pre-market trading:

Wall Street is set to kick off in the red, led by mixed news on the corporate front and after the Federal Reserve comments Wednesday that the US inflation was ticking higher, raising hopes for a faster pace of interest rate hikes than what had already been outlined.

The Dow Jones is pointing to a lower open, with its futures down 0.31% after it closed 174.07 points or 0.7% lower at 23,924.98 on Wednesday.

The S&P 500 also lost ground on Wednesday, falling 0.7% to 2,635.67 and is looking for another move into negative territory today, with its futures down 0.26%.

The Nasdaq, which also closed down 0.4% to 7,100.90 on Wednesday, is heading for another weak opening, with the Nasdaq futures down 0.43%.

On another front, eyes will be in Beijing, where both US and Chinese officials are holding talks on tariffs and trade issues, among others.

Given the recent sharp exchanges and slapping of punitive trade tariffs, the market will be closely monitoring developments and any news that may come out of the meeting.

The Federal Reserve which met this week, has held interest rates unchanged. The central bank’s next meeting will be on June 12 and 13.

“Further patience is required before the Fed publicly commits to any adjustments in the expected policy path for 2018, leaving markets to trade at the mercy of speculative headlines and animal spirits for another day,” State Street Global Advisors’ Sophia Ferguson said in a note.

On the data front, weekly jobless claims, the Markit April services purchasing managers’ index, the Institute for Supply Management’s non-manufacturing index, as well as the March factory orders are set to be released.

Asian stocks were also mostly weaker while the European stocks SXXP was down 0.38%.

Stocks that are likely to see some activity, include Tesla Inc (NASDAQ:TSLA) which is already pointing south, down 4.80% pre-market despite the electric carmaker unveiling late Wednesday market beating results for the quarter but concerns over its cash burn, huge debt pile and production issues remain.

The company’s earnings conference call by chief executive Elon Musk did not help matters much either after he reportedly brushed off analysts, told them their questions were morning and chose instead to take questions from someone with a YouTube channel.


And Musk tweeted: “La, la, la” to a news report that the company beat market expectations.


Kraft Heinz Co (NASDAQ: KHC) is also on the way down, after recording a more than 5% hike on Wednesday after beating market estimates.

Square Inc (NYSE:SQ) did not fare any better, dropping 5.38% in pre-market, extending losses posted on Wednesday after results and unveiling its spending plans.

Another stock in the red in pre-market was Fitbit Inc (NYSE:FIT) after the wearable devices company disappointed the market with its outlook, although it did beat Wall Street’s earnings consensus.

Spotify Technology SA (NYSE:SPOT) was down 10.01% pre-market after its results missed analysts' expectations.


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