U.S. Stocks Extend Losses as Tech Sector Slumps
DOW JONES & COMPANY, INC. 10:31 AM ET 4/29/2016
U.S. stocks traded lower Friday, as technology-sector losses deepened.
The sector is on track for its second consecutive week of sharp losses. A string of disappointing quarterly results from high-profile tech companies from Microsoft to Google parent Alphabet to Apple has led to persistent selling in the group, making it the worst performing sector year to date.
The Dow Jones Industrial Average fell 112 points, or 0.6%, to 17716. The Nasdaq Composite lost 0.6%.
The S&P 500 slumped 0.6% in early trading, weighed down by tech companies. Friday's decline put the sector on pace for a weekly loss of 3.8%.
The Stoxx Europe 600 declined 1.5%, following a weak session in Asia, as late losses on Wall Street Thursday reverberated overseas.
Haven assets continued to gain Friday. Gold rose 1.1% at $1,279 an ounce, while the yen hit an 18-month high against the dollar, weighed down by continued disappointment over the Bank of Japan's decision to leave its monetary policy unchanged on Thursday.
The dollar was last down 0.7% against the yen at Yen107.39. "The message from price action is telling," said Nicholas Ferres, investment director at Eastspring. People worry the Bank of Japan's policy may be ineffective, he said, citing persistent weakness in the country's growth and inflation.
In currencies, the dollar continued to fall against its developed and emerging market peers Friday as soft economic data eroded expectations for a U.S. interest-rate increase in June.
The personal-consumption expenditures price index, the Federal Reserve's preferred inflation measure, rose 0.1% in March from the prior month, data showed Friday, after Thursday's GDP report disappointed investors.
The euro rose 0.8% at $1.1442, on track for its highest close of the year, following four consecutive sessions of gains. The euro was bolstered Friday after data showed growth in the eurozone picked up in the first quarter, supporting a decline in unemployment.
The European Union's statistics agency said Friday that the eurozone's gross domestic product rose 0.6% from the final quarter of 2015 and was 1.6% higher than in the first quarter of 2015.
The Chinese yuan was more than half a percent higher against the dollar, its biggest daily increase since the currency was de-pegged from the greenback in 2005.
Stocks in Europe are up solidly for the month, while stocks in the U.S. are on track to eke out slight monthly gains. Still, markets have struggled to keep the momentum going in recent sessions, as economic and corporate readings have painted a mixed picture.
On the corporate front, U.S. profits are on track to fall for a third consecutive quarter, in the longest slide in earnings since the financial crisis, according to Thomson Reuters.
After U.S. markets closed Thursday, however, Amazon.com Inc. reported its most profitable quarter ever, sending shares in the company up nearly 10% on Friday.
"The fundamental question dividing the market now is whether we're rallying off the bottom, or if we are two-thirds of the way down with more losses to come," said Neil Passmore, CEO of Hannam and Partners.
Stock markets in Hong Kong and Shanghai also fell Friday, while markets in Japan were closed for a holiday.
Shares in Australia, however, eked out small gains, buoyed by rising commodity prices. U.S.-traded crude oil was up 0.5% at $46.25 a barrel, after settling at a fresh high for the year on Thursday.
Write to Riva Gold at riva.gold@wsj.com
(END) Dow Jones Newswires
04-29-161031ET
Copyright (c) 2016 Dow Jones & Company, Inc.
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