Dow dips on weakness from Goldman Sachs and Travelers
The Dow fell more than 1 percent on Tuesday as weak earnings from Goldman Sachs dragged the index lower, but a jump in Tesla shares helped the Nasdaq stay postive as the corporate earnings season took center stage. The rise in Tesla after the electric-vehicle maker's January retail sales surged in China helped growth-oriented shares eke out gains, but small caps and value stocks fell as fears of a recession unsettled investors. Earnings from Goldman Sachs and Morgan Stanley closed out what was a mixed bag for big banks, many of which have stashed rainy-day funds to gird against a potential downturn. Analysts are anxious to hear from corporate America about the demand environment amid signs of an upward trend in the economy, said Anthony Saglimbene, chief market strategist at Ameriprise Financial in Troy, Michigan. "Earnings estimates have declined so much at the start of earnings season that there's potential for companies to hurdle past a really low bar," Saglimbene said. "If the demand environment is still relatively healthy, that would exceed expectations because I think analysts took down earnings so much." Goldman Sachs Group slumped 6.44 percent after the bank reported a bigger-than-expected drop in quarterly profit and was the biggest drag on the price-weighted index. A stock's share value is proportional to its contribution to the index, in contrast to the market capitalization-weighted S&P 500. Goldman Sachs posted its biggest one-day percentage drop since a year ago in January. US-listed shares of Chinese companies declined, with JD.Com down 5.72 percent and Baidu Inc off 6.02 percent after China's economic growth in 2022 slumped to one of its worst levels in nearly half a century. Also weighing on the blue-chip Dow index was insurer Travelers Cos, which fell 4.60 percent after forecasting fourth-quarter earnings below estimates. But a 7.43 percent jump in Tesla helped keep the Nasdaq afloat after recent price cuts the company made on its top-selling models, data from China Merchants Bank International showed. Tesla was the largest percentage gainer on both the S&P 500 and the Nasdaq 100. The Dow Jones Industrial Average fell 1.14 opercent, to 33,911 and the S&P 500 lost 0.20 percent, to 3,991. The Nasdaq Composite added 0.14 percent, to 11,095. The Dow snapped a four-session win streak, while the Nasdaq notched its seventh straight gain, its longest streak since November 2021. Morgan Stanley rose 5.91 percent after it beat analysts' estimates for fourth-quarter profit as its trading business got a boost from market volatility. (Reuters)_____________________________
Last updated: 2023-01-18 HKT 08:30 