Wall Street falters after mixed gains, trading halt malfunction

Wall Street falters after mixed gains, trading halt malfunction

  • SEC investigates NYSE opening bell malfunction
  • 3M slides on dismal Q1 forecast
  • J&J falls on sales alert; GE down on weak earnings outlook
  • Microsoft will release quarterly figures after the stock market close
  • Indices: Dow up 0.18%, S&P 500 down 0.13%, Nasdaq down 0.25%

NEW YORK, Jan. 24 (Reuters) – Wall Street was mixed on Tuesday as a series of mixed earnings took some of the wind out of the recent rally.

The session got off to a rocky start, as a wave of NYSE-listed stocks was halted at the opening bell due to an apparent technical glitch, causing initial price confusion and prompting an investigation by the US Securities and Exchange Commission (SEC).

More than 80 stocks were affected by the outage, which caused wide swings in the opening prices of stocks, including Walmart Inc (WMT.N) and Nike Inc (NKE.N).

“It looks like NYSE got in on it very early,” said Joseph Sroka, chief investment officer at NovaPoint in Atlanta. “Now they’re trying to determine what the opening prices were.”

“Anyone involved in trading settlements is going to have a long day today.”

All three indices sputtered around the starting line, with little apparent momentum in either direction.

Fourth quarter earnings season is in full swing with 72 of the companies in the S&P 500 reporting. Of those, 65% beat the consensus, just a hair short of the long-term average of 66%, according to Refinitiv.

Overall, analysts now expect S&P 500 earnings to be 2.9% lower than in the quarter last year, compared to the 1.6% year-over-year decline on Jan. 1, according to Refinitiv.

“Earnings are not yet a bull or bear case for the market, but there is a fear among investors to stay long once the Fed is done raising rates,” Sroka added. “We are entering a ramp in the revenue cycle and next week we will have a lot more information on the direction of the market.”

Economic data showed smaller-than-expected contraction in the manufacturing and services sectors in the first weeks of the year, suggesting that the Federal Reserve’s restrictive interest rates are dampening demand.

The Dow Jones Industrial Average (.DJI) rose 60.69 points, or 0.18%, to 33,690.25, the S&P 500 (.SPX) lost 5.36 points, or 0.13%, to 4,014.45 and the Nasdaq Composite (.IXIC) fell 28.39 points, or 0.25%, to 11,336.03.

Of the 11 major sectors of the S&P 500, manufacturing fell the most.

Intercontinental Exchange Inc (ICE.N), which owns the New York Stock Exchange, fell 2.5% as SEC investigators looked for the source of the confusion at Tuesday’s opening bell.

Shares of Alphabet Inc (GOOGL.O) fell 1.8% after the Justice Department filed a lawsuit against Google alleging abuse of its dominance in the digital advertising business.

Johnson & Johnson (JNJ.N) earnings forecast beat analysts’ expectations. Still, the stock fell 0.3%.

Industrial conglomerates 3M Co (MMM.N) and General Electric Co (GE.N) both offered disappointing forecasts due to inflationary headwinds.

Shares of 3M fell 5.1%, while General Electric’s shares were slightly lower.

Aerospace/defense companies Lockheed Martin Corp (LMT.N) and Raytheon Technologies Corp (RTX.N) were a study in contrasts, with the former delivering a disappointing earnings forecast and the latter beating estimates of solid travel demand.

Lockheed Martin and Raytheon were up 1.5% and 2.5% respectively.

Railroad operator Union Pacific Corp missed earnings estimates as labor shortages and severe weather delayed shipments. His shares lost 2.7%.

Microsoft Corp. (MSFT.O) must report after the bell.

Emerging issues outnumbered declining issues on the NYSE by a ratio of 1.16 to 1; on Nasdaq, a ratio of 1.06 to 1 favored the fallers.

The S&P 500 posted 27 new highs in 52 weeks and 10 new lows; the Nasdaq Composite recorded 69 new highs and 21 new lows.

Reporting by Stephen Culp; Additional reporting by Shreyashi Sanyal and Johann M Cherian in Bengaluru; Edited by Aurora Ellis

Our Standards: The Thomson Reuters Principles of Trust.

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