By Stephen Culp
NEW YORK (Reuters) – Wall Street was mixed on Tuesday as a raft of mixed earnings took some wind out of the sails of the recent rally.
The session got off to an rocky start, as a spate of NYSE-listed stocks were halted at the opening bell due to an apparent technical glitch, which caused initial price confusion and prompted an investigation by the U.S. Securities and Exchange Commission (SEC).
More than 80 stocks were affected by the glitch, which caused wide swings in opening prices in stocks, including Walmart Inc and Nike Inc.
“It looks like NYSE got on it real early,” said Joseph Sroka, chief investment officer at NovaPoint in Atlanta. “Now they’re trying to determine what opening trade prices were.”
“Everyone involved in trade settlements is going to have a long day today.”
All three indexes sputtered near the starting line, with little apparent momentum in either direction.
Fourth quarter earnings season is in full swing, with 72 of the companies in the S&P 500 having reported. Of those, 65% have beaten consensus, just a hair below the 66% long-term average, according to Refinitiv.
On aggregate, analysts now expect S&P 500 earnings 2.9% below the year-ago quarter, down from the 1.6% year-on-year decline seen on Jan. 1, per Refinitiv.
“Earnings don’t make a bull or bear case for the market yet, but there’s an anxiousness among investors to be long when the Fed is done raising rates,” Sroka added. “We’re hitting a ramp in the earnings cycle, and by next week we’ll have a lot more information on the direction of the market.”
Economic data showed shallower-than-expected contraction in the manufacturing and services sector in the first weeks of the year, suggesting that the Federal Reserve’s restrictive interest rates are dampening demand.
The Dow Jones Industrial Average rose 60.69 points, or 0.18%, to 33,690.25, the S&P 500 lost 5.36 points, or 0.13%, to 4,014.45 and the Nasdaq Composite dropped 28.39 points, or 0.25%, to 11,336.03.
Among the 11 major sectors of the S&P 500, industrials led the percentage gainers, while healthcare was down the most.
Intercontinental Exchange Inc, owner of the New York Stock Exchange, dropped 2.5% as SEC investigators searched for the cause of Tuesday’s opening bell confusion.
Alphabet Inc shares dipped 1.8% after the Justice Department filed a lawsuit against Google for abusing its dominance of the digital advertising business.
Johnson & Johnson’s profit guidance came in above analyst expectations. Even so, its stock softened 0.3%.
Industrial conglomerates 3M Co and General Electric Co both provided underwhelming forward guidance due to inflationary headwinds.
3M’s shares were off 5.1% while General Electric’s were modestly lower.
Aerospace/defense companies Lockheed Martin Corp and Raytheon Technologies Corp were a study in contrasts, with the former issuing a disappointing profit forecast and the latter beating estimates on solid travel demand.
Lockheed Martin and Raytheon were up 1.5% and 2.5%, respectively.
Railroad operator Union Pacific Corp missed profit estimates as labor shortages and severe weather delayed shipments. Its shares shed 2.7%.
Microsoft Corp is due to report after the bell.
Advancing issues outnumbered declining ones on the NYSE by a 1.16-to-1 ratio; on Nasdaq, a 1.06-to-1 ratio favored decliners.
The S&P 500 posted 27 new 52-week highs and 10 new lows; the Nasdaq Composite recorded 69 new highs and 21 new lows.
(Reporting by Stephen Culp; Additional reporting by Shreyashi Sanyal and Johann M Cherian in Bengaluru; Editing by Aurora Ellis)