FILE - In this March 18, 2019, file photo trader Craig Esposito, left, works with specialists Peter Mazza, center, and Vera Liu on the floor of the New York Stock Exchange. The U.S. stock market opens at 9:30 a.m. EDT on Thursday, May 2. (AP Photo/Richard Drew, File)

Technology companies help pull US stocks broadly lower

May 02, 2019 - 2:15 pm

Stocks fell broadly on Wall Street in afternoon trading Thursday as investors reviewed a mostly mixed batch of corporate earnings reports.

Technology and communications companies accounted for much of the sell-off. Energy stocks took the heaviest losses as the price of crude oil slumped. Real estate and financial companies bucked the downward trend.

Engineering company Fluor plunged after reporting a huge loss, which weighed on the industrial sector. Online games maker Zynga surged after raising its revenue forecast for the year.

Solid earnings results from several insurance companies helped lift some individual stocks, including MetLife. Qualcomm rose after reporting good earnings results.

Earnings reporting season is more than a third of the way through and the results have been better than investors had expected. Analysts had been predicting a severe profit slump and their worst fears have not materialized.

The broader market has been steadily rising this year. The S&P 500 index is up 16.3% for the year and notched three straight all-time highs before finishing lower Wednesday after remarks by the head of the Federal Reserve appeared to dim prospects for an interest rate cut by the central bank this year.

KEEPING SCORE: The S&P 500 index was down 0.3% as of 2:10 p.m. Eastern Time. The Dow Jones Industrial Average fell 147 points, or 0.6%, to 26,282. The Nasdaq composite dropped 0.3%.

Major indexes in Europe were mostly lower.

ANALYST'S TAKE: Investors are still digesting comments on Wednesday from Federal Reserve Chair Jay Powell. He played down the possibility of an interest rate cut this year and restated the central bank's message that there will likely be no rate hikes in 2019.

Those comments made it seem like investors had a "less supportive Fed" than they anticipated, said Brad McMillan, chief investment officer for Commonwealth Financial Network.

McMillan noted that a pullback in stocks was likely because they have been gaining so much over the last few weeks.

"We ran up to new highs again and I think the markets are getting a little bit nervous about that," he said.

FLUOR FLOORED: Engineering and construction company Fluor plunged 23.9% after it issued an earnings forecast that was far below what analysts were expecting. It also reported a huge loss for the quarter, while investors were expecting a profit. They also reported revenue that came in well below forecasts.

OIL SLUMP: Benchmark U.S. crude fell 3.3% to $61.55 per barrel. Brent crude, the international standard, dropped 2.4% to $70.40. The slide weighed on energy stocks. The sector was the biggest decliner in the S&P 500, shedding 1.4%. Marathon Oil gave up 5.6% while Concho Resources dropped 3.9%.

RECHARGING THE BATTERY: Tesla is trying to raise some cash after taking a heavy loss in the first quarter, and investors seem to approve.

The stock rose 4.1% after the electric car maker said it would seek to raise more than $2 billion in a stock and debt offering. Tesla reported a shrinking balance sheet and falling sales during the first quarter and CEO Elon Musk had suggested it might need to raise more money.

NO SWEAT: Sports apparel company Under Armour gained 3% after it reported a first quarter earnings results that beat Wall Street forecasts. The company reported a solid revenue increase fueled by international sales that helped swing it to a profit. It raised its profit forecast for the year.

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AP Business Writer Damian J. Troise contributed to this report.

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