NEW YORK (Reuters) – The Dow and S&P 500 ended modestly low on Friday, dragged down by losses at high-tech firms Intel and IBM after their quarterly results, while hopes for a full economic reopening in the coming years months have decreased.
IBM Corp fell 9.91% and was the main hurdle for the Dow Jones Industrial Average after it lost quarterly revenue estimates, hampered by a rare drop in sales of its software unit.
Intel Corp fell 9.29% as post-profit comments from new CEO Pat Gelsinger suggested the lack of strong adoption of outsourcing.
However, losses in the technology sector were offset by gains from Microsoft Corp Apple Inc, keeping falls in major US equity indices under control and slightly lifting Nasdaq.
The energy and financial sectors had the worst performances among the 11 S&P sectors on Friday, while defensive utilities and real estate groups advanced.
“Any delay or setback on the reopening theme is likely to be an obstacle for the energy sector,” said Andrew Mies, chief investment officer at 6 Meridien in Wichita, Kansas.
“(But) the market is telling you that your confidence in cyclicals is now diminished.”
The S&P 500 and Nasdaq reduced some losses just after the opening bell, as data showed that US manufacturing activity surged surprisingly to its highest level in more than 13 ½ years in early January, in contrast to a disappointing result of the purchasing manager given in Europe previously.
The Dow Jones Industrial Average fell 179.03 points, or 0.57%, to 30,996.98, the S&P 500 lost 11.6 points, or 0.30%, to 3,841.47 and the Nasdaq Composite added 12.15 points , or 0.09%, to 13,543.06.
The volume on the United States stock exchanges was 12.79 billion shares, compared to the average of 12.68 billion for the entire session in the last 20 trading days.
Despite the weakness, the top three indices made weekly gains, with the high-tech Nasdaq tracking its best weekly performance since November 6, while investors huddled in Alphabet Inc, Apple Inc and Amazon.com Inc in anticipation of their reporting. profits in the coming weeks.
For the week, S&P rose 1.94%, Dow rose 0.59% and Nasdaq unofficially gained 4.19%.
With stock valuations approaching levels not seen since the Dotcom era, some market participants said the new variants of COVID-19 and the hiccups at vaccine launches pose short-term risks.
President Joe Biden said on Friday that the U.S. economic crisis is deepening and that the government needs to take important steps now to help struggling Americans.
“The absolute security that investors felt a week ago … part of it is starting to disappear from the market.” Mies added, about the fall of the virus and the reopening of the economy.
The Senate Finance Committee unanimously approved the appointment of Janet Yellen as the first female secretary of the Treasury, indicating that she will easily obtain full Senate approval.
Decreasing issues outperformed advanced issues on the NYSE by 1.00 to 1; on the Nasdaq, a ratio of 1.53 to 1 favored the forwards.
The S&P 500 recorded 16 new 52-week highs and no new lows; the Nasdaq Composite recorded 189 new highs and 7 new lows.
Reporting by Echo Wang in New York; Additional reporting by Devik Jain and Medha Singh in Bengaluru; Editing by Saumyadeb Chakrabarty, Anil D’Silva and Diane Craft