Wall Street closes mixed as tech fall offsets trade optimism
- Disappointing earnings figures from Facebook weighs on FAANG on Thursday.
- Trade optimism lifts industrials.
- Rising crude oil prices boost energy shares.
After starting the day on a mixed note, major equity indexes in the United States failed to set a definite trend on Thursday amid varying sectoral performances.
Facebook shares lost nearly 20% on the day after the company's second-quarter earnings missed the expectations and the company said that profit margins would continue to shrink amid rising costs related to measures they have been taking to improve the privacy protection. Next in line to report earnings in FAANG (Facebook, Amazon, Apple, Netflix, Google) group after the closing bell will be Amazon, which fell more than 2%.
"So much emphasis has been placed on the success and robust returns that FAANG stocks have enjoyed year-to-date. With Facebook reporting disappointing metrics, that caused some rotation and broadened market participation," Eric Wiegand, senior portfolio manager at U.S. Bank Private Wealth Management in New York, told Reuters.
The S&P 500 Information Technology Index dropped around 1.7% on the day to become the worst-performing sector of the day.
On the other hand, easing concerns over the potential negative impact of Trump administration's protectionist trade policy helped the trade-sensitive S&P 500 Industrials Index to gain nearly 1% for the second day in a row.
Meanwhile, news of Saudi Arabia temporarily suspending oil shipments through the Red Sea's Bab al-Mandeb strait on Thursday provided a boost to crude oil prices. After testing the $70 mark earlier in the session, the barrel of West Texas Intermediate settled 30 cents higher for the day at $69.60. The S&P 500 Energy Index added a little over 1% to help the S&P 500 limit its losses.
The Dow Jones Industrial Average added 115.47 points, or 0.45%, to 25,529.579, the S&P 500 lost 8.63 points, or 0.3%, to 2,837.44 and the Nasdaq Composite erased 80.86 points, or 1%percent, to 7,851.38.