US STOCKS-S&P, Nasdaq end lower in fickle trading

SGH

25/07/2024 21:00

* 
      US economic growth regains steam in Q2; inflation slows
    

        * 
      Ford slumps as higher costs, EV unit dent profit growth
    

        * 
      IBM gets boost from software, AI demand, as consulting
slips
    

        * 
      Gains for small-cap indexes Russell 2000 and S&P Small Cap
600
    

  
 (Updates to close)
    By David French
       July 25 (Reuters) - 
    The S&P 500 and Nasdaq Composite ended lower on Thursday in
fickle trading, ultimately failing to regain ground lost during
the previous day's tech-triggered sell-off.
        The Dow Jones Industrial Average hung onto its gains to
close higher, after stronger-than-expected GDP data provided
support, and small-cap stocks also rose as investors sought out
value away from the megacaps.
    The small-cap Russell 2000  .RUT  gained, partially
recouping Wednesday's broad losses. The Dow  .DJI  was the best
of the three main benchmarks as investors reassessed their
recent flight to underperforming sectors.
    Megacap stocks endured a volatile day. Having recovered from
a shaky start, they were in mostly in positive territory at
mid-afternoon, before some slipped late in the day.
    Alphabet's  GOOGL.O  shares fell for a second straight day,
but Tesla  TSLA.O  rose. Lackluster earnings from the Google
parent and the electric vehicle maker had pummeled the so-called
Magnificent Seven group of tech stocks on Wednesday, prompting
the Nasdaq  .IXIC  and S&P 500  .SPX  to log their worst day
since 2022.
    "I think the market is kind of lurching," said Yung-Yu Ma,
chief investment officer at BMO Wealth Management. "The concern
had been building and yesterday was a bit of a crescendo of that
concern, but some of that has been alleviated today."
        While investors are still trying to grapple with
Wednesday's disappointing earnings reports, and political and
economic uncertainty, Ma said ultimately recent data shows a
resilient U.S. economy.
  
        Thursday's gross domestic product report showed the U.S.
economy expanded 2.8% in the second quarter versus an estimate
of 2%. Inflation subsided, leaving expectations of a September
Federal Reserve interest rate cut intact.
    All eyes are now on Friday's personal consumption
expenditures price data to confirm bets of an early start to Fed
rate cuts.
    While heavyweight stocks have powered the market to all-time
highs this year, Wednesday's sell-off reinforced fears that
these stocks might be over-stretched and are in for more
turbulence.
    This concern has driven value investors, speeding up their
rotation into smaller-cap stocks and other sectors outside
megacap technology.
    The S&P Small Cap 600  .SPCY  rose on Thursday.
    According to preliminary data, the S&P 500  .SPX  lost 27.52
points, or 0.51%, to end at 5,399.61 points, while the Nasdaq
Composite  .IXIC  lost 162.01 points, or 0.93%, to 17,180.40.
The Dow Jones Industrial Average  .DJI  rose 87.38 points, or
0.22%, to 39,940.10.

 
    Among earnings-driven moves, IBM  IBM.N  shares jumped, also
boosting the blue-chip Dow, after the tech company beat
estimates for second-quarter revenue and raised the annual
growth forecast for its software business.
    American Airlines  AAL.O  rose after cutting its annual
profit forecast. Southwest Airlines  LUV.N  climbed after saying
it would implement changes including ending open seating and
offering seats with extra legroom.
    Advances by airlines and logistics firms, including Old
Dominion  ODFL.O  and J B Hunt  JBHT.O , helped the Dow Jones
Transportation Average  .DJT  gain. 
    Ford  F.N  slumped after the automaker's second-quarter
adjusted profit missed estimates by a wide margin. Edwards
Lifesciences  EW.N  tumbled after it missed second-quarter
revenue estimates.
    

    <^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
S&P500 breaks calm streak with 2%+ drop    https://tmsnrt.rs/3A8anwg
    ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>
 (Reporting by Ankika Biswas, Lisa Pauline Mattackal and Medha
Singh in Bengaluru and David French in New York; Editing by
Savio D'Souza, Saumyadeb Chakrabarty, Pooja Desai and Richard
Chang)
 ((Ankika.Biswas@thomsonreuters.com))