Markets Get Mixed Signals

Stocks were mixed on Thursday as earnings reports brought some bad news, while bringing good news for BlackRock.

Thursday brought a mixed bag of earnings reports, which sent stocks in a number of different directions. The financial sector generally had a bad day after a horrible earnings miss by Citigroup (NYSE:C). On the other hand, BlackRock (NYSE:BLK) — home of the iShares ETFs — beat earnings estimates and saw its stock price surge 1.61 percent.

Thursday’s big tragedy featured Best Buy (NYSE:BBY), which saw its share price take a 26.83 percent nosedive after reporting weak holiday season sales.

The Dow Jones Industrial Average (NYSEARCA:DIA) lost 64 points to finish Thursday’s trading session at 16,417 for a 0.39 percent decline. The S&P 500 (NYSEARCA:SPY) made a 0.13 percent retreat to close at 1,845. The Nasdaq 100 (NASDAQ:QQQ) rose 0.04 percent to finish at 3,611. The Russell 2000 (NYSEARCA:IWM) advanced 0.15 percent to end the day at a record-high 1,173.13.

In other major markets, oil (NYSEARCA:USO) declined 0.36 percent to close at $33.65. On London’s ICE Futures Europe Exchange, March futures for Brent crude oil declined 19 cents (0.8 percent) to $105.56/bbl. (NYSEARCA:BNO). February gold futures advanced $1.10 (0.09 percent) to $1,241.30 per ounce (NYSEARCA:GLD). Transports got slowed down by the snow on Thursday, as the Dow Jones Transportation Average declined 0.63 percent (NYSEARCA:IYT).

In Japan, the exchange rate for the yen continued to be the dominant factor in stock market activity. Japanese stocks made modest declines as the yen strengthened to 104.17 per dollar during Thursday’s trading session in Tokyo. A stronger yen causes Japanese exports to be less competitively priced in foreign markets (NYSEARCA:FXY). The Nikkei 225 Stock Average declined 0.39 percent to 15,747 (NYSEARCA:EWJ).

Stocks held close to the break-even level in mainland China as investors were disappointed that the People’s Bank of China has been holding back on further liquidity injections. In Hong Kong, Internet giant Tencent Holdings bought a ten percent stake in e-commerce firm, South China City. The Shanghai Composite Index rose 0.02 percent to 2,023 (NYSEARCA:FXI). Hong Kong’s Hang Seng Index advanced 0.37 percent to 22,986 (NYSEARCA:EWH).

In Europe, stocks made a moderate retreat as a result of disappointing earnings reports from a number of retail firms, whose names would be unfamiliar to most Americans. The Euro STOXX 50 Index declined 0.59 percent to 3,150 on Thursday — remaining above its 50-day moving average of 3,048. Its Relative Strength Index is 63.28 (NYSEARCA:FEZ).

Technical indicators revealed that the S&P 500 remained above its 50-day moving average of 1,806 after declining 0.13 percent from its latest record-high close to finish Thursday’s trading session at 1,845. Its Relative Strength Index declined from 61.69 to 60.34. The MACD is on a level trajectory, just below the signal line, which would suggest that the S&P could remain in the 1,845 — 1,848 range during the immediate future.

On Thursday, five sectors advanced and four sectors declined. The utilities sector made the biggest advance, climbing 0.69 percent. The financial sector made the most significant decline, falling 0.63 percent.

Consumer Discretionary (NYSEARCA:XLY): -0.53%
Technology: (NYSEARCA:XLK): -0.03%
Industrials (NYSEARCA:XLI): -0.25%
Materials: (NYSEARCA:XLB): +0.24%
Energy (NYSEARCA:XLE): +0.14%
Financials: (NYSEARCA:XLF): -0.63%
Utilities (NYSEARCA:XLU): +0.69%
Health Care: (NYSEARCA:XLV): +0.25%
Consumer Staples (NYSEARCA:XLP): +0.02%

Bottom line: Stocks were mixed on Thursday as a wide spectrum of earnings reports brought an equally wide range of stock market performances.

John Nyaradi is the author of The ETF Investing Premium Newsletter.

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