Techs Pop on Earnings, but Dow Struggles
The biggest tech companies and market leaders — Facebook, Amazon and Apple — soared on Friday after reporting better-than-expected quarterly results. But the Dow Jones Industrial Average struggled to find the green.
The 30-stock average retreated 55.19 points to 26,258.46. as Caterpillar and Chevron led the declines.
The S&P 500 regained 2.64 points to 3,248.86.
The NASDAQ gained 74.88 points to 10,662.69.
Emergency unemployment benefits are set to expire Friday and Congress and the White House still seem far apart on an agreement.
Dow-component Chevron fell more than 4% after the oil giant reported an $8.3-billion loss in the second quarter as the pandemic "significantly reduced demand."
Stocks linked to an economic recovery like banks and retailers were lower as investors assessed the biggest quarterly gross domestic product contraction on record and persistently weak job growth. JPMorgan and Home Depot were both in the red.
There could be a so-called "sell-the-news" effect now that technology companies have delivered strong results to back up their market-leading run.
Apple reported a blowout quarter, sending shares up more than 6%. The company said its overall sales expanded by 11%, and Apple also announced a four-for-one stock split.
Amazon, meanwhile, traded 5% higher as the company saw its sales skyrocket during the coronavirus pandemic. Facebook shares rallied more than 7% as the social media giant posted revenue growth of 11% even amid the coronavirus pandemic slowdown. The company also issued stronger-than-expected sales guidance for the current quarter.
Google-parent Alphabet also posted better-than-expected earnings, but the company’s overall revenue declined for the first time in its history. Revenue for Google Cloud was also just below analyst expectations. Alphabet shares fell more than 4%.
Collectively the four stocks were set to add about $200 billion to their total market cap, bringing it to more than $5 trillion combined.
Big Tech has been the stalwart on Wall Street this year. Amazon and Apple are up 65% and 31%, respectively, in 2020. Facebook and Alphabet have risen more than 14% over that time period.
Prices for the 10-Year Treasury backpedaled, raising yields to 0.56% from Thursday’s 0.54%. Treasury prices and yields move in opposite directions.
Oil prices forged ahead 24 cents to $40.16 U.S. a barrel.
Gold prices revived $15.10 to $1,981.90 U.S. an ounce.