US stocks closed mixed on Thursday, with the Dow and Nasdaq marking fresh record highs but the S&P 500 doing as much – before heading lower after US President Donald Trump mooted that he was weighing up a 20% border tax on Mexican imports to pay for his immigration wall with the neighbouring nation.
Earlier in the day, a planned trade meeting between Mexico and the US was abruptly cancelled by the southern neighbour after Trump insisted that he would talk about Mexico paying for the wall partition. Mexico refuses to pay for the partition which is aimed at preventing Mexicans from entering the US illegally.
The Nasdaq Composite actually skidded to end down 0.02% at 5655 after reaching a fresh record high of 5669.61. The Dow Jones Industrial Average managed to end 0.2% higher at 20,100 after scaling a fresh high of 20,125.58 after breaking the 20K barrier on Wednesday.
After the bell, Nasdaq was set for a weaker start on Friday after Google’s profits missed forecasts but Microsoft romped home with better profits thanks to its investment in cloud storage technology.
Google owner Alphabet (NASDAQ:GOOGL) shares fell in after-hours trading on Thursday after the Google parent company revealed quarterly earnings that were short of analysts’ expectations.
The Mountain View, California-based company disclosed adjusted quarterly profits, which exclude certain items, of $9.36 a share, missing Wall Street forecasts of $9.62.
Alphabet’s sales soared by 22 per cent in the final three months of 2016 to $26.1bn. Excluding the costs of acquiring traffic, revenues came in at $21.2bn, topping estimates of $20.6bn.
Alphabet shares were down 1.7% at $842.90 after hours on Thursday.
Conversely, Microsoft (NASDAQ:MSFT) reported better-than-expected profits for its fiscal second quarter, sending the software company’s share price up slightly in after-market trading.
Earnings per share were $0.83, using the adjusted measure watched by Wall Street, up from $0.76 the previous quarter.
Microsoft shares were up 1.2% at $65.03 after hours.
Staying with the Nasdaq, Intel (NASDAQ:INTC) beat Wall Street’s estimates for sales and earnings in its fourth quarter, boosted by a stronger end to the year from PC sales and continued momentum in the data centre.
Revenues grew 10 per cent to $16.4bn in the fourth quarter of 2016, Intel said on Thursday, with net income broadly flat at $3.6bn. Wall Street had expected around $15.8bn in sales. Earnings were 1 per cent lower at 73 cents per share but better than the 68 cents analysts were anticipating.
Intel was up 0.6% at $37.80 after hours.
But the S&P 500 market bellwether was the ticker with the most to lose. Having marked a fresh record high of 2300.99 it ended 0.07% lower at 2296.
Toy and games maker Mettel Inc (NASDAQ:MAT) was the biggest faller on the S&P 500, down 17.7% to $25.96 as fourth quarter earnings and revenues lagged expectations.
Copper miner Freeport-McMoran (NYSE:F="" rel="6188">NYSE:FCX) paid $33m to the Democratic Republic of Congo’s state miner Gecamines to resolve a dispute over its $2.65bn sale of the largest copper mine in the country.
The settlement removes the final hurdle for the mine to be sold to China Molybdenum, giving the Chinese company a prized copper asset at a time of rising prices for the red metal.
The payment was Freeport’s share of a settlement agreement reached with Gecamines, China Moly, and the other parties involved in the sale of the Tenke Fungurume copper and cobalt mine, Freeport said in its earnings statement.
Freeport shares closed down 4% at $15.84.
The S&P Midcap 400 closed down 0.3% at 1704 and led by Lancaster Colony Corp (NASDAQ:LANC) down 10.7% to $132.75. Investor Welch & Forbes LLC decreased its stake in Lancaster Colony by 2.0% during the third quarter, according to its most recent Form 13F filing with the Securities and Exchange Commission.
The S&P Smallcap 600 closed down 0.6% at 841 and led by World Acceptance (NASDAQ:WRLD) down 18.3% to $49.37.
Early trading
US stocks burst fresh record highs early on Thursday as the “Trumptrade” continued to deliver punch, while small-caps backed off.
The S&P 500, the market bellwether was up 0.05% at 2,299 having hit a record high of 2,300.99.
The Dow Jones Industrial Average was up 0.2% at 20,116 having chalked a fresh record at 20,125.58, while the Nasdaq Composite hit a record at 5,669.61 right after the opening but since then has fallen, by 0.02% to 5655.
But it was the S&P 500, a broader and more closely watched index than the Dow, which has earned investor attention, having surged by almost 8% since the election of Donald Trump as US President in November, on expectations of higher US economic growth and inflation.
But while growth expectations are heightened so too are those for inflation and higher US interest rates to come.
The top gainer on the S&P 500 was United Rentals (NYSE:URI) up 12.3% at $128.14 after beating estimates in its earnings report.
The S&P Midcap 400 was up 0.09% at 1711 after hitting a fresh record high of 1714.67 earlier.
The top riser was Sm Energy Company (NYSE:SM) up 6.4% to $34.30 after oil prices surged. The US oil benchmark the WTI was up 2.3% to $53.97.
The S&P Smallcap 600 was down 0.3% at 844 and led by the aptly named World Acceptance (NASDAQ:WRLD) down 16.5% to $50.47.
Similarly, the wider small-cap ticker Russell 2000 was down 0.2% at 1379 and led by World Acceptance, which was dragging the Nasdaq down too.
Pre-Open
US stocks are set to open flat-to-firm on Thursday but if the previous session is any guide might hit fresh record highs early in the day.
The trio of majors – S&P 500, Dow Jones Industrial Average and Nasdaq Composite – all struck record highs intraday and closing levels on Wednesday as the Trump rally from 2016 resumed and the Dow pitched a level above the 20,000 milestone.
Statistically, just opening higher will cement fresh record highs, but whether new highs at or soon after the open transpire will rest mostly upon the slew of earnings reports spewing out onto the trading floors before the bell.
A lot of blue-chip companies and tech giants are reporting quarterly results Thursday.
Comcast (NASDAQ:CMCSA) defied cord-cutting concerns in 2016, adding thousands of new television customers — its first full-year gain in a decade.
The largest US cable provider, which owns NBC TV networks and Universal film studio, signed up 80,000 video subscribers in the fourth quarter and 161,000 for the year.
Comcast shares were down 1% at $72.70.
Dow Chemical (NYSE:DOW), which is working on completing its $140bn merger with DuPont (), has reported underlying earnings per share above analysts’ expectations, boosted by plants expansions and cost savings.
It has also hailed the expected boost to the US economy the new administration “promising structural reforms.”
Dow Chemical shares were up 0.7% at $60.64.
Ford Motor Co (NYSE:F) has confirmed that it expects profits in 2017 to fall as it invests to become a transport services provider, as the US’s second largest car maker revealed lower profits for last year due to changes to its pension accounting.
The company booked a $3bn charge in the final quarter of the year due to a re-measurement of its pension and benefit plan, which it had flagged was expected at the end of last year.
Annual net profit fell by $2.8bn to $4.6bn, and the group reported rising car sales and revenues during the year.
Ford shares were down 0.6% at $12.72. Others reporting before the bell are rival Fiat Chrysler (NYSE:FCAU).
Caterpillar (NYSE:CAT) shares slid in early trading after the US heavy machinery maker said sales declined more than expected during the fourth quarter and issued a downbeat outlook warning that the “overall environment remains challenging”.
For the three months to end of December, sales and revenues fell 13% to $9.6bn, shy of the $9.8bn analysts had expected, with sales down in all regions except Asia Pacific, and across all major business categories.
CAT shares were down 1% at $97.20.
The company said its operating loss widened to $1.26bn in the fourth quarter, compared to a loss of $175m in the year ago quarter.
Sherwin-Williams (NYSE:SHW) reported fourth-quarter net income of $203 million.
On a per-share basis, the Cleveland-based company said it had profit of $2.15. Earnings, adjusted for costs related to mergers and acquisitions, were $2.34 per share.
The results topped Wall Street expectations. The average estimate of nine analysts surveyed by Zacks Investment Research was for earnings of $2.22 per share.
Sherwin shares were up 7.3% at $304.00 pre-market.
Southwest Air (NYSE:LUV) shares were up 4.3% at $51.60 as the company reports.
Meanwhile, United Rentals (NYSE:URI) and eBay (NASDAQ:EBAY) shares surged after the companies reported better-than-expected results on Wednesday. On the flip side, Mattel (MAT) is set to tank after releasing earnings that came in below expectations. United Rental was up 9% at $124.50 and eBay up 6.5% at $32.19.
Johnson & Johnson (NYSE:JNJ) announced it's paying $29.3bn to buy the Swiss biopharmaceutical firm Actelion.
Shares in Actelion surged 20% after the announcement. J&J shares were down 0.4% at $112.30.
The companies have had an on-off relationship. They had been talking about a deal, broke things off in December, only to return a few days later to exclusive talks about a deal.
Meanwhile, Baker Hughes (NYSE:BHI), the oilfield services group that is in the process of becoming a semi-autonomous division of General Electric, has reported a loss for the fourth quarter that was larger than analysts had expected.
It also warned of a difficult outlook for the first half of this year, in spite of the rebound in oil prices over the past 12 months, and said the GE deal was on course for completion in the first half of this year.
Baker Hughes shares were up 0.6% at $64.00.
Sales of Bristol-Myers Squibb’s (NYSE:BMI) blockbuster immunotherapy drug stalled in the US in the fourth-quarter, as the company lost ground because the medicine recently flunked a late-stage clinical trial.
Bristol Myers sold $715 worth of Opdivo in the last three months of 2016, barely changed on $712m in the prior quarter.
Analysts had been expecting the drug to generate $741m in US revenues, even accounting for the recent trial failure.
Bristol shares were down 1.9% at $48.60.
Higher sales in its aerospace and mission systems units helped Northrop Grumman (NYSE:NOC) drive fourth quarter sales but the US defence contractor issued a downbeat earnings outlook for the year.
The Virginia-based company said profits rose to $525m or $2.96 a share, compared with $459m or $2.49 a share in the year ago period. Sales climbed more than 12 per cent to $6.4bn driven by a near 20 per cent year-on-year jump in aerospace system sales and 9 per cent growth in missions system sales — the company’s largest divisions.
Northrup shares were down 0.8% at $229.05.