U.S. stocks fall at midday Thursday as traders watch Iran tensions; Sandisk drops 5%
Early Friday Beijing time, U.S. stocks were lower at midday Thursday as traders watched developments in the Middle East, including progress toward an agreement to reopen the Strait of Hormuz. Wall Street was also digesting a heavy slate of corporate earnings reports. The Dow Jones Industrial Average fell 368.11 points, or 0.68%, to 53,981.01. The Nasdaq Composite fell 41.35 points, or 0.16%, to 26,322.09, while the S&P 500 declined 20.30 points, or 0.26%, to 7,703.25. Salesforce shares fell 3.8% after the company announced a leadership reorganization. Sandisk shares dropped 5.1% after the storage company reported fourth-quarter results that failed to satisfy investors. AppLovin plunged 19% after reporting mixed quarterly results. Western Digital fell 10% after its first-quarter forecast disappointed investors, although its fourth-quarter results exceeded expectations. “After a wave of active trading triggered by earnings season, the market seems to be mostly taking a breather,” said JJ Kinahan, head of retail expansion and alternative investments at the Chicago Board Options Exchange. “Better-than-expected profit and sales, when paired with weak guidance, do not always push a stock higher.” “Some profit-taking may also be at work,” he added, noting that Sandisk and Western Digital have both surged over the past year. Sandisk soared 3,000% over the past 12 months, while Western Digital jumped more than 530%. Oil prices edged higher as Iran and Oman approached an agreement to reopen the Strait of Hormuz. An Iranian government official told MS NOW that, under an interim agreement, shipping through the strait would not be charged fees or tolls. “There have been multiple false dawns in the market during this conflict,” Deutsche Bank strategist Jim Reid wrote. “While the details are becoming more concrete, the focus is shifting from whether an agreement can be reached to what the final arrangement will look like, including unresolved questions such as whether Iran will ultimately be allowed to charge tolls to vessels using the strait.”
The Dow Jones Industrial Average fell 368.11 points, or 0.68%, to 53,981.01. The Nasdaq Composite fell 41.35 points, or 0.16%, to 26,322.09, while the S&P 500 declined 20.30 points, or 0.26%, to 7,703.25.
Salesforce shares fell 3.8% after the company announced a leadership reorganization. Sandisk shares dropped 5.1% after the storage company reported fourth-quarter results that failed to satisfy investors.
AppLovin plunged 19% after reporting mixed quarterly results. Western Digital fell 10% after its first-quarter forecast disappointed investors, although its fourth-quarter results exceeded expectations.
“After a wave of active trading triggered by earnings season, the market seems to be mostly taking a breather,” said JJ Kinahan, head of retail expansion and alternative investments at the Chicago Board Options Exchange. “Better-than-expected profit and sales, when paired with weak guidance, do not always push a stock higher.”
“Some profit-taking may also be at work,” he added, noting that Sandisk and Western Digital have both surged over the past year. Sandisk soared 3,000% over the past 12 months, while Western Digital jumped more than 530%.
Oil prices edged higher as Iran and Oman approached an agreement to reopen the Strait of Hormuz. An Iranian government official told MS NOW that, under an interim agreement, shipping through the strait would not be charged fees or tolls.
“There have been multiple false dawns in the market during this conflict,” Deutsche Bank strategist Jim Reid wrote. “While the details are becoming more concrete, the focus is shifting from whether an agreement can be reached to what the final arrangement will look like, including unresolved questions such as whether Iran will ultimately be allowed to charge tolls to vessels using the strait.”