By Wallace Witkowski, MarketWatch , Ryan Vlastelica
Twitter sees biggest 1-day drop since October as user growth
disappoints
U.S. stocks retreated from all-time highs Thursday, with the
Nasdaq and S&P 500 falling into negative territory as tech
stocks gave up early gains inspired by another round of largely
upbeat corporate earnings.
The Dow Jones Industrial Average was up 14 points, or 0.1%, at
21,725, as Verizon Communications Inc.(VZ) shares soared 7% and
Merck & Co.(MRK) shares rallied 4.2%. Apple Inc. (AAPL) shares
weighed on the index with a 2.2% decline. Earlier, the blue-chip
average set an intraday record of 21,790.13.
The S&P 500 fell 12 points, or 0.5%, to 2,466, as
industrials fell 0.8% and tech stocks dropped 1.6%, after the index
touched an intraday record of 2,484.04. Earlier in the session, the
tech sector was up as much as 0.6%.
The Nasdaq Composite Index fell 76 points, or 1.2% to 6,346,
after touching an intraday record of 6,460.84.
Stocks pulled back in midday trading as gains in tech stocks
swung to sharp losses.
"We're still up for the week but these are the points where
people take profits," said Mark Kepner, managing director of sales
and trading at Themis Trading. Plus, with the pressure coming
midsession a toning down of volume can amplify moves, Kepner
said.
After being up more than 5% earlier, Facebook Inc.(FB) shares
were up 2.9% a day after the social media giant posted results that
beat quarterly earnings expectations
(http://blogs.marketwatch.com/thetell/2017/07/26/facebook-earnings-put-instagram-in-focus-amid-shift-in-newsfeed-ads-live-blog/).
The company could be nearing a $500 billion market cap
(http://www.marketwatch.com/story/facebook-heads-toward-500-billion-market-cap-after-earnings-2017-07-26)
if shares maintain their strength throughout the session. The stock
has already jumped nearly 50% thus far this year.
Facebook is one of the so-called FAANG stocks, a reference to
the quintet of technology and internet names (Facebook, Apple,
Amazon (AMZN), Netflix (NFLX), and Google parent Alphabet
(GOOGL)(GOOGL) that have driven market returns thus far this year.
However, those sharp gains have also raised questions over
valuations.
"Tech stocks are having to live up to lofty expectations, given
the gains they've experienced this year--particularly in the bigger
names--and the levels of growth we're seeing are doing just that,"
said Craig Erlam, senior market analyst at Oanda, in emailed
comments.
Read:Next stop for Facebook shares? $200, say analysts
applauding results
(http://www.marketwatch.com/story/next-stop-for-facebook-shares-200-say-analysts-applauding-results-2017-07-27)
Read:Facebook keeps warning about growth, but growth doesn't
stop
(http://www.marketwatch.com/story/facebook-keeps-warning-about-growth-but-growth-doesnt-stop-2017-07-26)
Among other corporate results, Procter & Gamble Co.(PG) rose
1% after the Dow component posted a fourth-quarter profit that was
above expectations
(http://www.marketwatch.com/story/procter-gamble-shares-edge-up-following-q4-earnings-beat-2017-07-27).
United Parcel Service Inc. (UPS) also fell 3.9% despite its results
topping consensus forecasts
(http://www.marketwatch.com/story/ups-shares-rise-as-earnings-beat-estimates-2017-07-27).
MasterCard Inc.(MA) also reported stronger-than-expected
earnings
(http://www.marketwatch.com/story/mastercard-beats-estimates-as-consumer-spend-more-2017-07-27)
and revenue for the second quarter as consumers boosted their
spending. Shares were 2.1% lower.
Twitter (TWTR) tumbled 14% after the microblogging platform
reported lackluster user growth. The stock is on track for its
biggest one-day decline since October.
Comcast Corp.(CMCSA) posted profit and revenue that beat
analysts expectations
(http://www.marketwatch.com/story/comcast-profit-revenue-beat-analysts-expectations-2017-07-27),
and shares rose 1.6%.
PayPal Holdings Inc.(PYPL) shares added 0.4% after the mobile
payment group topped earnings views and raised guidance
(http://www.marketwatch.com/story/paypal-shares-up-2-after-company-tops-views-raises-guidance-2017-07-26).
After the market close, Amazon.com Inc.(AMZN) is scheduled to
report its quarterly results
(http://www.marketwatch.com/story/amazon-earnings-with-a-dominant-position-in-the-us-analysts-look-abroad-2017-07-25),
along with Expedia Inc. (EXPE), Intel Corp.(INTC), Starbucks
Corp.(SBUX) and Mattel Inc.(MAT).
Overseas companies with U.S.-listed shares were also active.
AstraZeneca PLC(AZN.LN) (AZN.LN) sank 15% after the drug
heavyweight reported a negative result in a Phase 3 clinical trial
of its lung-cancer treatment Mystic
(http://www.marketwatch.com/story/astrazenecas-mystic-cancer-drug-trial-fails-2017-07-27).
(http://www.marketwatch.com/story/astrazenecas-mystic-cancer-drug-trial-fails-2017-07-27)
Shares of rival Bristol-Meyer Squibb Co.(BMY) fell 2.9% after its
results.
Anheuser-Busch InBev NV(ABI.BT) (ABI.BT) moved 5.5% higher after
the brewing giant posted a surge in quarterly profit
(http://www.marketwatch.com/story/ab-inbev-profit-up-despite-drop-in-us-market-share-2017-07-27).
(http://www.marketwatch.com/story/ab-inbev-profit-up-despite-drop-in-us-market-share-2017-07-27)And
the world's largest liquor maker Diageo PLC(DEO) soared 5.2% after
lifting its target for profit margin growth
(http://www.marketwatch.com/story/diageo-full-year-earnings-lifted-by-currency-boost-2017-07-27).
Economic data: The number of Americans who applied for
first-time unemployment benefits rose in late July but remained
near the lowest level in decades
(http://www.marketwatch.com/story/us-jobless-claims-climb-10000-to-244000-2017-07-27).
Separately, orders for durable or long-lasting U.S. goods soared
6.5% in June
(http://www.marketwatch.com/story/boeing-bonanza-durable-goods-orders-soar-65-in-june-2017-07-27).
Other markets: European stocks traded mixed
(http://www.marketwatch.com/story/european-stocks-search-for-direction-in-busy-session-for-earnings-2017-07-27)
as investors absorbed a heavy stream of earnings, while in Asia ,
equity markets were broadly positive
(http://www.marketwatch.com/story/asia-stocks-broadly-positive-nikkei-lifted-by-nintendo-2017-07-27).
Gold prices rose 0.9%, with precious and base metals rising
across the board.
The ICE Dollar Index rose following an earlier decline, and was
last trading up 0.3% at 93.92. The dollar weakened on Wednesday,
after some analysts viewed the Federal Reserve as striking a dovish
tone in its policy statement
(http://www.marketwatch.com/story/fed-to-wind-down-bond-holdings-relatively-soon-2017-07-26).
--Barbara Kollmeyer in Madrid contributed to this report.
(END) Dow Jones Newswires
July 27, 2017 13:51 ET (17:51 GMT)
Copyright (c) 2017 Dow Jones & Company, Inc.