US close: Markets finish mixed, Alphabet beats earnings forecast

US stocks finished mixed on Monday as investors awaited corporate news from the likes of Alphabet ahead of what promises to be a busy week on the earnings front.

Nasdaq 100

20,684.59

12:15 19/11/24

0.71%

145.40

The Dow Jones Industrial Average was down 0.31% at 21,513.17 and the S&P 500 was off 0.11% at 2,469.91, while the tech-heavy Nasdaq 100 finished 0.34% higher at 5,941.37.

“The Dow is staring at a very busy earnings calendar, the highlight being tonight’s second quarter report from Google parent Alphabet,” said Spreadex analyst Connor Campbell.

“As for the greenback, Wednesday sees the month’s Federal Reserve meeting, with the currency on the lookout for any hawkish hints to help rescue it from a sour summer."

On the data front, Markit's flash US manufacturing purchasing managers' index came in at a four-month high in July.

The manufacturing index rose to 53.2 from 52.0 the month before amid accelerated growth in output, new orders, employment and stocks of inputs.

Manufacturers linked higher volumes of new work to improving demand conditions and signs of reduced risk aversion among clients.

Meanwhile, Markit's flash services PMI remained unchanged from the previous month at 54.2, its fastest rate of expansion since January.

A reading above 50 indicates expansion, while a reading below signals contraction.

“The July PMI surveys show an economy gaining growth momentum at the start of the third quarter, enjoying the strongest monthly improvement in business activity since January,” said Chris Williamson, chief business economist at IHS Markit.

Elsewhere, data from the National Association of Realtors showed that sales of US existing homes fell more than expected in June.

Sales were down 1.8% to a seasonally-adjusted annual rate of 5.52m from 5.62m in May, while economists had been expecting a much smaller decline of 1.0%.

Market participants were also digesting a decision by the International Monetary Fund to downgrade its economic growth forecast for the US this year to 2.1% from 2.3% and its estimate for 2018 to 2.1% from 2.5% previously.

"The major factor behind the growth revision, especially for 2018, is the assumption that fiscal policy will be less expansionary than previously assumed, given the uncertainty about the timing and nature of US fiscal policy changes," the IMF said in its latest World Economic Outlook on Sunday.

In corporate news, WebMD Health surged 19.77% on news that KKR & Co. will take the healthcare information provider private in a deal valued at $2.8bn.

Halliburton was in the red by 4.21%, reversing course despite a near-30% jump in quarterly revenues, while shares in toy maker Hasbro fell 9.44% after its quarterly revenue missed expectations.

Retailer Hibbett Sports plunged 33.5% after cautioning that second-quarter sales are expected to fall.

Google parent Alphabet released its second quarter earnings after markets closed, with earnings per share ahead of expectations at $5.01, against the $4.49 forecast.

Revenue was ahead year-on-year at $26.01bn, from $21.5bn, while paid clicks were up 52% on the same time last year.

Is cost per click was a sore point, however, dropping 23% from 12 months ago, leading to a drop in the stock after hours of 2.72% at 2215 BST.

Dow Jones - Risers

Caterpillar Inc. (CAT) $108.18 1.49%
Apple Inc. (AAPL) $152.09 1.21%
Travelers Company Inc. (TRV) $126.38 0.98%
Wal-Mart Stores Inc. (WMT) $76.89 0.97%
Visa Inc. (V) $100.35 0.77%
JP Morgan Chase & Co. (JPM) $91.28 0.43%
Cisco Systems Inc. (CSCO) $31.86 0.06%
Boeing Co. (BA) $212.18 0.02%
Chevron Corp. (CVX) $103.20 -0.05%
Walt Disney Co. (DIS) $107.04 -0.08%