US stocks close flat on mixed earnings
AP PHOTO
NEW YORK – US stocks finished flat on Friday under the shadow of earnings disappointments but tempered by a slightly better-than-expected estimate of economic growth in the third quarter.
The Dow Jones Industrial Average finished up 3.53 points (0.03 percent) at 13,107.21.
The broad-based S&P 500 lost 1.03 (0.07 percent) at 1,411.94, while the Nasdaq Composite gained 1.83 (0.06 percent) to 2,987.95.
The first government estimate of third-quarter gross domestic product growth came in at 2.0 percent, a healthy rebound from 1.3 percent in the prior quarter but still too slow to build much optimism.
IHS Global Insight US economists Nigel Gault and Paul Edelstein said the low-gear economy would remain a drag on profits.
“We don’t think that growth is accelerating. In fact, the details confirm our view that the economy will further experience modest but subpar growth,” they said in an analysis.
Earnings set the pace of the markets, with Apple losing 0.9 percent after missing expectations in its quarterly report, while Amazon bounced 6.9 percent higher despite its loss and cautious outlook for the holiday shopping season.
Banks were mostly lower: Citigroup fell 2.2 percent, Bank of America 1.3 percent and JPMorgan Chase, with Bank of America now reportedly in a new group of banks that have been subpoenaed in the investigation over rigging the Libor benchmark interest rate.
Netflix recovered 13.1 percent two days after investors dumped the shares on reports that Apple would push ahead with its own streaming video service. Some fresh rumors circulated over Microsoft’s interest in the company.
Arch Coal, which reported a strong third quarter on cost cutting and forecast a rebound in coal prices, jumped 10.7 percent.
Cable operator Comcast added 3.3 percent as it topped earnings forecasts and spoke of strong momentum in all parts of the business.
Merck fell 0.3 percent on its report of slower sales than expected, though it turned in a 22 percent rise in profits, and 95 cents earnings per share which beat forecasts by three cents.
Bond prices pushed higher. The yield on the 10-year US Treasury fell to 1.75 percent from 1.83 percent late Thursday, while the 30-year dropped to 2.92 percent from 2.98 percent.
Bond prices move inversely to yields.
