Washington – The New York Stock Exchange closed in the red on Thursday, weighed down by investors’ nervousness amid growing uncertainties in the Middle East, while keeping an eye on corporate results.
Following a double record for the Nasdaq and the broader S&P 500 index the previous day, they fell by 0.89% and 0.41%, respectively. The Dow Jones dropped by 0.36%.
According to Art Hogan of B. Riley Wealth Management, there is currently a “tug-of-war between fundamentals – results that have been better than expected so far – and the fact that news from the Strait of Hormuz has not improved.”
“Today, it feels like attention to results has been overshadowed by rising energy prices,” he explained to AFP.
Oil prices continued to rise – with Brent above $100 a barrel – due to “disappointment caused by the failure to reopen the Strait of Hormuz, coupled with the tense anticipation of upcoming negotiations” between Washington and Tehran, according to Carsten Fritsch of Commerzbank.
US President Donald Trump stated on Thursday that he had “all the time in the world” in the Middle East conflict, where the ceasefire in place for two weeks between Tehran and Washington seems to be hanging by a thread.
Iranian media reported explosions in Tehran, and the Israeli defense minister said he was ready to resume war, although a country security source informed AFP that the army was not attacking Iran.
“Bond yields and oil prices remain uncomfortably high,” observed Adam Turnquist of LPL Financial.
The yield on the U.S. 10-year Treasury bond benchmark rose to 4.32% from 4.30% the previous day.
Although stock indices fell, analysts at Briefing.com suggest that the decline should be put into perspective.
“For example, the Nasdaq was up 14.2% for the month before today’s session, so it is not unreasonable to say that it was vulnerable to some profit-taking,” they noted.
Another focus for investors has been the quarterly performance of companies.
Electronic components specialist Texas Instruments surged by over 20% to $282.23, thanks to better-than-expected results in the first three months of the year. The company expects its net profit per share for this quarter to range between $1.77 and $2.05, compared to the $1.57 estimated by analysts.
Briefing.com analysts see this as a “general strength” and “a new momentum” for Texas Instruments.
Software publisher ServiceNow (-17.59% at $84.94) lost ground despite a 22% increase in its first-quarter revenue. Its net profit barely increased during the period, and the company cited “headwinds” from the Middle East, where the war delayed the conclusion of some contracts.
Following its lead, Adobe fell by 6.63% and Oracle by 5.98%.
Despite better-than-expected results, electric vehicle specialist Tesla was penalized for its increasingly high spending projections, estimated at $25 billion this year.
Its stock fell by 3.56% to $373.72.
As for indicators, weekly jobless claims came in slightly above expectations, but “it must be recognized that the claims remain very low compared to historical standards,” according to Samuel Thombs of Pantheon Macroeconomics.
AFP/RP
