Apple's flagship store in Madrid is closed due to the pandemic.
MarketWatch/Barbara KollmeyerU.S. stocks extended their losses in morning trading, as the approaching presidential election, surging coronavirus case counts and underwhelming technology-company earnings prompted investors to reduce their exposure to risk.
T he Dow Jones Industrial Average declined about 375 points, or 1.4%, while the Nasdaq Composite dropped 2.5% and the S&P 500 slid 1.7%. Stocks snapped a four-session rout on Thursday, after third-quarter preliminary gross domestic product data climbed 33.1% and weekly jobless claims dipped.
Major U.S. indexes were on track to post their first string of two consecutive monthly losses since March, while the Dow was heading for its biggest monthly loss since then. Asian stocks fell across the board and the Stoxx Europe 600 index was marginally lower.
Notably, the benchmark 10-year Treasury yield was higher by one basis point, or hundredth of a percentage point, meaning prices declined. That is unusual on days like Friday; when risky markets sell off, haven markets, such as gold and Treasuries typically gain. Unlike Treasuries, however, gold prices advanced, rising 0.8%.
Shares of several big U.S. technology companies fell after a raft of earnings.
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Apple shares (ticker: AAPL) fell 5% after the iPhone maker posted slightly better-than-expected sales and profits for its fiscal fourth-quarter. Investors zeroed in on a lack of guidance and a slip in iPhone sales.
Shares of Amazon.com (AMZN) were down 4.1%, possibly amid disappointment over its forecasts for fourth-quarter operating income, even though the e-commerce giant’s earnings were better than expected. Facebook shares (FB) were down 5.7% after its results, which alluded to uncertainty in 2021.
Hardest hit among the late earnings crowd was Twitter (TWTR), which fell 18%. The microblogging and social media group soundly beat forecasts, but noted that the behavior of advertisers was unpredictable ahead of the U.S. election.
On the brighter side, shares of Google parent Alphabet (GOOGL) gained nearly 5%, as sales growth returned to levels seen before the pandemic.
Netflix shares (NFLX) rallied late on Thursday, but were recently down 3.7%. The streaming video service raised prices for U.S. subscribers, a move many analysts have been anticipating in recent months.
Starbucks (SBUX) shares slid 1.7% even though the coffee chain’s earnings were better than expected.
In Europe, shares of Air France-KLM tumbled after the airline swung to a heavy net loss in its third quarter, warning of significantly lower earnings for the last three months of the year.
Investors on both sides of the Atlantic continued to watch climbing coronavirus cases and the potential for more damage to the economy. U.S. consumers will likely have to wait until after next week’s presidential election for a government spending package to support growth, after lawmakers failed to reach agreement despite weeks of trying.
In Europe, the French government cut its 2020 growth forecast to a contraction of 11%. The aim is to take into account the impact of fresh Covid-19 restrictions, which were announced earlier this week. Germany also announced temporary lockdowns.
New coronavirus cases in the U.S. reached a record high, prompting a new wave of lockdowns in El Paso, Texas, and other parts of the country to slow the virus’s spread.
Write to Barbara Kollmeyer at bkollmeyer@marketwatch.com, Alexandra Scaggs at alexandra.scaggs@barrons.com and Carleton English at carleton.english@dowjones.com
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October 30, 2020 at 09:53PM
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Stocks’ Losses Grow as Tech Profits Fail to Dazzle - Barron's
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