US stocks pared losses into the Thursday close, but by any reckoning it was still a grubby session.
The S&P 500 market bellwether closed down by 0.2% to 2270, marking a rebound from the almost 1% fall it registered earlier in the day. Meanwhile, the Dow narrowed two-third of its day’s losses and ended down 0.3% at 19,891. The tech-heavy Nasdaq Composite was down by 0.3% at 5547.
Thursday got off to a rough start amid disappointment over US President-elect Donald Trump’s press conference that was held in the previous session. Investors had been hoping for more details on his fiscal and economic programmes, and plans to soften regulations - factors that have helped ignite a sharp rally in the equities market since the election.
So this week, the bourse wobbled. The Nasdaq being the only stubborn one in the pack, although in December it was also often struggling when the other two major tickers raced to record highs, so some of it may be viewed as catch-up.
With Trump’s inauguration day still more than a week away, the more immediate catalyst for stocks will be corporate earnings. Banks JPMorgan Chase, Bank of America and Wells Fargo, three of America’s largest lenders, all report fourth-quarter figures on Friday, and then the pace of releases revs up in the following weeks.
On Thursday, Cincinnati Financial (NASDAQ:CINF), down 6.66% to $69.90 led the losers on the S&P 500, after the insurance holding company said its Q4 pretax catastrophe losses will climb to between $75 million and $85 million following wildfires in eastern Tennessee that destroyed an estimated 2,400 structures.
The S&P Midcap 400 closed down 0.5% at 1678 – also clawing back two-thirds of its session losses – and led by Vista Outdoor Inc (NYSE:VSTO) down 21.7% at $29.58. The S&P Smallcap 600 closed down 1.2% at 833. Both the S&P 600 and the wider small-cap Russell 2000, down 0.9% at 1361, were led by Tidewater Inc (NYSE:TDW) down 18.7% at $2.82.
Early trading
US shares were sharply lower on Thursday as various industrial stocks fell while pharma stocks still reeled from remarks overnight by President-elect Donald Trump.
Even news that Amazon (NASDAQ:AMZN) was to create 100,000 jobs in the US – the latest corporation to announce such measures ahead of Trump’s presidential inauguration next week – failed to lift the market’s mood. Amazon shares outperformed, but that was easily done. Shares up 0.6% to $803.47.
The Nasdaq Composite lost more than 1% and the Dow Jones Industrial Average 0.8%.
The S&P 500 market bellwether was down 0.9% at 2255 and led by oil group Hess Corp (NYSE:HES), down 7.6% to $57.18 – its biggest day drop in nearly a year.
The energy company announced it would take more than $4.6bn in charges for the fourth quarter, even as it prepares to nudge up capital and exploratory spending in the coming year.
The glimpses of optimism in Hess’s 2017 capital and exploratory budget were not enough to keep investors from selling off its shares on Thursday.
Another heavy hitter was Fiat Chrysler (NYSE:FCAU) whose shares tumbled 18.4% to $9.05 after US environmental regulators accused it of using software to evade diesel-emissions testing.
The US Environmental Protection Agency said in a statement that the violations cover roughly 104,000 vehicles and that FCA “may be liable for civil penalties.”
Delta Air Lines Inc. (NYSE:DAL) – for whom there were high hopes of gains and a pre-market mini-rally in its stock - saw its net profits plunge by 37% in the fourth-quarter as a 30% jump in salaries and related costs weighed on the US firm. That sent the share price down 3% to $49.90.
The S&P Midcap 400 was 1.5% lower at 1661 and led by Vista Outdoor Inc (NYSE:VSTO) down 23.5% to $28.93.
The S&P Smallcap 600 was down by the most in more than a year – 2.1% - to 825. Tidewater Inc (NYSE:TDW) led the losses, down 19.6% to $2.79.
Pre-Open
US stocks point to an overall dive at the opening on Thursday, as investors continue to digest the ramifications of President-elect Donald Trump’s speech the previous day.
Shares in pharmaceutical companies continued to drop Thursday as investors fretted over Trump's impact on the sector's profitability.
Trump said Wednesday that many pharma companies were "getting away with murder" and that there would be more “aggressive” competitive bidding practices for federal contracts in his administration.
Shire (NASDAQ:SHPG) was among the hardest hit stocks right, down about 4% and was last down 1.7% to $166.68.
The S&P 500 market bellwether is indicated down 0.3%, as is the toppy Nasdaq Composite, while the Dow Jones Industrial Average is set for a 0.2% fall.
A slew of Fed officials will also be speaking on Thursday. But worthy to note that the yield on the US 10-year Treasury note auction late Wednesday fell, as opposed to the usual rises you see before rate hikes. The yield came in a 2.342% versus 2.485% last time.