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May 25, 2018

Stocks open lower as Wall Street juggles solid earnings, geopolitical fears - May 25, 2018. Stocks at Open | CNBC.

cnbc.com

Stocks open lower as Wall Street juggles solid earnings, geopolitical fears

Thomas Franck

Traders and financial professionals work ahead of the closing bell on the floor of the New York Stock Exchange (NYSE), April 6, 2018 in New York City. Getty Images
U.S. stocks opened mostly lower Friday morning as solid corporate earnings were offset by geopolitical fears after President Donald Trump called off a key summit with North Korea.
The Dow Jones industrial average fell 45 points immediately after the opening bell, led lower by losses in shares of Chevron and Goldman Sachs. The S&P 500 fell 0.1 percent amid losses in energy and financials stocks.
The Nasdaq composite rose less than 0.1 percent thanks to gains in Netflix and Google-parent Alphabet.
Trading volume has been below its recent trend this week as traders leave Wall Street ahead of the long weekend. Markets will be closed Monday for the Memorial Day holiday.
A string of solid earnings reports has kept equities afloat this week, with Foot Locker adding to the optimism on Friday.
The athletic shoe retailer handily beat Wall Street expectations, posting adjusted earnings per share of $1.45 versus expectations of $1.24 per share. It posted revenue of $2.03 billion, also ahead of estimates.
The company's stock was up more than 13 percent in premarket trading following the report.
"At the end of the day, it's going to come down to earnings and the ability of companies to beat," said Jeremy Klein, chief market strategist at FBN Securities. "Things are quiet ahead of the holiday ... [but] there's nothing to suggest corporate earnings in the next couple quarters will be any less impressive."
Several other S&P 500 components also gave investors reason for optimism throughout the week, including home improvement retailer Lowe's.
Though the Mooresville, North Carolina-based company missed expectations for the first quarter on Wednesday, its stock rose more than 10 percent after it maintained its annual financial targets.
Shares also rallied after famed hedge fund manager Bill Ackman revealed a $1 billion stake in the company; the stock is up more than 12 percent since Tuesday's close.
High-end jeweler Tiffany & Co., meanwhile, is having one of its best weeks on Wall Street.
The company's stock rose more than 23 percent after reporting that same-store sales rose 7 percentin the quarter, overshooting expectations of only 2.6 percent. It also raised its full-year guidance in light of the solid beat.
The New York-based company suggested its comeback plan is working to retain price-conscious millennial shoppers from drifting to new competitors. Its stock is up 22.3 percent this week.
The generally buoyant sentiment following the earnings numbers was tempered after President Trump's abrupt decision to scrap a landmark summit with North Korean leader Kim Jong Un. The meeting would have been the first face-to-face encounter between a sitting U.S. president and a North Korean premier.
In response, Pyongyang's vice foreign minister said the country still hoped for a "Trump formula," before adding the Asian state would remain open to resolving long-standing issues with the world's largest economy. This helped market sentiment to recover Friday morning with European stocks posting solid gains.
The Stoxx Europe 600 rose 0.3 percent Friday, while the Korean Kospi lost 0.2 percent.
U.S. stocks finished lower on Thursday on the news of the canceled summit in Singapore. The Dow Jones industrial average fell 75 points to finish at 24,811.76 by the closing bell, well off a 280-point drop immediately after Trump's statement.
New orders for U.S.-made capital goods increased more than expected in April, hinting that business spending on equipment was accelerating after a slowdown toward the end of the first quarter.
The Commerce Department said Friday that orders for non-defense capital goods excluding aircraft, a closely watched proxy for business spending plans, jumped 1 percent last month. Economists polled by Reuters had forecast core capital goods orders rising 0.7 percent last month.
Overall orders for durable goods, items ranging from toasters to aircraft that are meant to last three years or more, dropped 1.7 percent in April.