| |
Financial Markets 05/07 15:42
NEW YORK (AP) -- U.S. stocks fell from their records Thursday after oil
prices yo-yoed as Wall Street waits to see whether its hopes for a deal to end
the Iran war are warranted or just wishful.
The price for a barrel of Brent crude oil settled at $100.06, down 1.2%, and
continued its decline from more than $115 early this week. But it swung sharply
before getting there, as Iran said it was reviewing the latest U.S. proposals
on ending their war.
The hope is that an end to the war will reopen the Strait of Hormuz and
allow oil tankers trapped in the Persian Gulf to deliver crude again to
customers. Oil and gasoline are still much more expensive than they were before
the war began because of the strait's closure.
Brent's price briefly fell near $96 per barrel Thursday after a spokesperson
for Pakistan's Foreign Ministry said, "We expect an agreement sooner rather
than later." Pakistan has been mediating talks between the United States and
Iran. But Brent later erased much of that drop and briefly topped $102, which
in turn sent stocks lower on Wall Street.
The S&P 500 fell 0.4% from its all-time high set the day before. The Dow
Jones Industrial Average dropped 313 points, or 0.6%, and the Nasdaq composite
slipped 0.1% from its own record.
Wall Street saw even sharper swings earlier in the war, when hopes rallied
for a reopening of the Strait of Hormuz, only to get quickly dashed. That could
happen again. And Iran has created a government agency to vet and tax vessels
seeking passage through the strait, a shipping data company reported Thursday,
a move that could add to costs for fuel.
Despite all the uncertainties about the war, a powerful parade of U.S.
companies reporting even bigger profits for the start of the year than analysts
expected has helped support the U.S. stock market. Stock prices tend to follow
the path of corporate profits over the long term.
Datadog leaped 31.3% to help lead the U.S. market after the monitoring and
security platform for cloud applications topped analysts' expectations for
profit in the latest quarter.
Albemarle rose 3% after the lithium products and specialty chemicals company
likewise delivered better-than-expected results. Taser maker Axon Enterprise
rallied 10.6% after raising its forecast for revenue this year in part because
of big growth for its counter-drone products.
On the losing end of Wall Street was Whirlpool, which tumbled 11.9% after
reporting much weaker results than analysts expected. It's instituting the
largest price increases in a decade for its major appliances in North America,
while accelerating cuts to its costs, as it contends with weaker confidence
among U.S. consumers.
Shake Shack dropped 28.3% after its results for the latest quarter fell well
below analysts' expectations.
McDonald's stock held steadier and slipped 0.1% after its revenue for the
latest quarter edged past analysts' expectations. CEO Chris Kempczinski said
high gasoline prices and consumer anxiety over the Iran war could dent its
sales this spring.
All told, the S&P 500 fell 28.01 points to 7,337.11. The Dow Jones
Industrial Average dropped 313.62 to 49,596.97, and the Nasdaq composite
slipped 32.75 to 25,806.20.
In the bond market, Treasury yields rose after oil prices pared their drops.
The yield on the 10-year Treasury climbed to 4.38% from 4.36% late Wednesday.
Higher yields can raise rates for mortgages and other kinds of loans going
to U.S. households and businesses, which in turn can slow the economy. Higher
yields also tend to push downward on prices for stocks and other kinds of
investments.
The 10-year Treasury yield was at just 3.97% before the war.
Several reports on the U.S. economy came in mixed. One said more U.S.
workers applied for unemployment benefits last week, but the increase was not
as bad as economists expected. Another report suggested that productivity for
U.S. workers improved by only half of what economists expected for the latest
quarter.
In stock markets abroad, indexes fell in Europe following a stronger finish
in Asia. Stocks dropped 1.5% in London and 1.2% in Paris.
Japan's Nikkei 225 roared 5.6% higher as trading in Tokyo resumed following
a holiday and caught up with big gains for Asian markets from earlier in the
week. It has soared nearly 71% in the last 12 months on strength for tech
stocks benefiting from the boom in artificial intelligence.
"I think it's a kind of bubble because buying activity concentrated on
leading AI, artificial intelligence stock and semiconductor-related stocks.
It's a situation where only semiconductor stocks are being bought," said
Takashi Hiroki, chief strategist at MONEX.
___
AP Business Writers Matt Ott and Elaine Kurtenbach contributed to this
report.
---------
itemid:44bac8b794519ae9169f968ddc9ea675
|
|
