US stocks fell on Friday as a decline in oil prices added to pressure from consumer companies after gloomy quarterly reports from Nordstrom and JC Penney overshadowed upbeat retail sales data for last month.
The decline in department stores’ shares marked the end of a week that highlighted the expanding clout of Amazon.com and the plight of brick-and mortar retailers struggling to keep up with the online seller.
Crude prices slipped as a stronger US dollar weighed and investors cashed in on gains from a three-day rally.
That pushed the S&P energy index down 1.25 percent.
US retail sales jumped 1.3 percent last month, the largest gain since March last year and a bigger rise than economists expected, the US Department of Commerce said. Core retail sales, which excludes automobiles, gasoline, building materials and food services, also rose more than expected.
However, consumer stocks, which have already been under pressure this week after a string of feeble earnings reports, fell again after Nordstrom and JC Penney reported lower-than-expected sales.
Nordstrom slumped 13.42 percent and JC Penney Co Inc lost 2.82 percent. Dillard’s Inc, which gave a quarterly report that also disappointed Wall Street, fell 1.29 percent.
Amazon lost 1.12 percent, but was 5 percent higher for the week following steady gains since the previous Friday.
On Wednesday, Macy’s poor quarterly report triggered a selloff in US retailers. It lost 17 percent for the week after gaining US$0.01 cent on Friday to US$31.22.
First-quarter earnings reports are nearly all in and, on average, have not been quite as bad as expected across the S&P 500. However, for June-quarter earnings, for every company that has given an upbeat preannouncement, 2.3 others have sounded warnings, according to Thomson Reuters I/B/E/S.
That has left the S&P 500 trading at about 16.5 times expected earnings, according to Thomson Reuters I/B/E/S.
“It’s hard to make a case that you’re going to have stellar equity market performance. In the context of low interest rates, equity valuations look about right,” said Mark Heppenstall, chief investment officer at Penn Mutual Asset Management in Horsham, Pennsylvania.
The Dow Jones Industrial Average dropped 1.05 percent to end at 17,535.32 and the S&P 500 lost 0.85 percent to 2,046.61.
The NASDAQ Composite dropped 0.41 percent to 4,717.68.
All of the 10 major S&P sectors fell, led by a 1.29 percent decline in financials. Consumer staples lost 1.23 percent.
For the week, the Dow fell 1.2 percent, the S&P dipped 0.5 percent and the NASDAQ lost 0.4 percent. It was the third week in a row of losses for the Dow and S&P 500.
The S&P 500 is about flat for this year.
In a bright spot, Nvidia surged 15.21 percent after the graphics chipmaker forecast better-than-expected revenue for the current quarter.
Declining issues outnumbered advancing ones on the NYSE by 2,000 to 980. On the NASDAQ, 1,627 issues fell and 1,145 advanced.
The S&P 500 index showed 15 new 52-week highs and eight new lows, while the NASDAQ recorded 27 new highs and 76 new lows.
About 6.6 billion shares changed hands on US exchanges, light compared with the daily average of about 7.2 billion shares for the past 20 trading days, according to Thomson Reuters data.
MAJOR BENEFICIARY: The company benefits from TSMC’s advanced packaging scarcity, given robust demand for Nvidia AI chips, analysts said ASE Technology Holding Co (ASE, 日月光投控), the world’s biggest chip packaging and testing service provider, yesterday said it is raising its equipment capital expenditure budget by 10 percent this year to expand leading-edge and advanced packing and testing capacity amid strong artificial intelligence (AI) and high-performance computing chip demand. This is on top of the 40 to 50 percent annual increase in its capital spending budget to more than the US$1.7 billion to announced in February. About half of the equipment capital expenditure would be spent on leading-edge and advanced packaging and testing technology, the company said. ASE is considered by analysts
TRANSFORMATION: Taiwan is now home to the largest Google hardware research and development center outside of the US, thanks to the nation’s economic policies President Tsai Ing-wen (蔡英文) yesterday attended an event marking the opening of Google’s second hardware research and development (R&D) office in Taiwan, which was held at New Taipei City’s Banciao District (板橋). This signals Taiwan’s transformation into the world’s largest Google hardware research and development center outside of the US, validating the nation’s economic policy in the past eight years, she said. The “five plus two” innovative industries policy, “six core strategic industries” initiative and infrastructure projects have grown the national industry and established resilient supply chains that withstood the COVID-19 pandemic, Tsai said. Taiwan has improved investment conditions of the domestic economy
Huawei Technologies Co’s (華為) latest smartphones carry a version of the advanced made-in-China processor it revealed last year, results from an independent analysis showed. This underscored the Chinese company’s ability to sustain production of the controversial chip. The Pura 70 series unveiled last week sports the Kirin 9010 processor, research firm TechInsights found during a teardown of the device. This is a newer version of the Kirin 9000s, made by Semiconductor Manufacturing International Corp (SMIC, 中芯) for the Mate 60 Pro, which had alarmed officials in Washington who thought a 7-nanometer chip was beyond China’s capabilities. Huawei has enjoyed a resurgence since
purpose: Tesla’s CEO sought to meet senior Chinese officials to discuss the rollout of its ‘full self-driving’ software in China and approval to transfer data they had collected Tesla Inc CEO Elon Musk arrived in Beijing yesterday on an unannounced visit, where he is expected to meet senior officials to discuss the rollout of "full self-driving" (FSD) software and permission to transfer data overseas, according to a person with knowledge of the matter. Chinese state media reported that he met Premier Li Qiang (李強) in Beijing, during which Li told Musk that Tesla's development in China could be regarded as a successful example of US-China economic and trade cooperation. Musk confirmed his meeting with the premier yesterday with a post on social media platform X. "Honored to meet with Premier Li