Off The Wire
Wall Street eases from record highs on coronavirus concerns, Cisco results
(Reuters) - Wall Street’s main indexes eased from record highs on Thursday, pressured by shares of Cisco after its disappointing quarterly forecast, while a spike in new coronavirus cases in China weighed on the sentiment.
The Chinese province at the center of the coronavirus outbreak reported a record rise in deaths and thousands more infections using a new diagnostic method, casting fresh uncertainty over the scale of the virus outbreak.
A day earlier, investors had bought on signs that the virus spread was slowing, lifting the benchmark S&P 500 .SPX and the Nasdaq .IXIC to their third straight closing highs. Dow Jones Industrials .DJI settled at an all-time high on Wednesday for the first time since Feb 6.
“The virus news coming out of China (is) a bit concerning, especially when investors thought it was all behind them,” said Paul Nolte, portfolio manager at Kingsview Asset Management in Chicago.
“We are also due for at least a little bit of a pullback.”
Cisco Systems Inc (CSCO.O) shares declined more than 6%, the biggest drag on the three indexes, after the network gear maker’s lackluster revenue and profit forecasts.
NetApp Inc (NTAP.O) tumbled about 11% as the data storage equipment maker’s current-quarter profit forecast fell short of expectations.
Technology stocks .SPLRCT, which have surged more than 10% this year, slipped 0.4%. Seven of the 11 major S&P sectors were lower.
At 9:54 a.m. ET, the Dow Jones Industrial Average .DJI was down 95.16 points, or 0.32%, at 29,456.26 and the S&P 500 .SPX was down 7.01 points, or 0.21%, at 3,372.44. The Nasdaq Composite .IXIC was down 28.81 points, or 0.30%, at 9,697.15.
Among other stocks, Kraft Heinz Co (KHC.O) shed 7.6% as it missed quarterly sales estimates and wrote down the value of some businesses - including coffee brand Maxwell House - by $666 million.
Caterpillar Inc (CAT.N) rose 0.4% after Goldman Sachs upgraded the construction and mining equipment maker’s shares to “buy”.
The fourth-quarter earnings season is winding down with 351 S&P 500 companies having reported so far. Of those, 70.9% have topped profit estimates, according to IBES data from Refinitiv.
Declining issues outnumbered advancers for a 1.31-to-1 ratio on the NYSE and for a 1.45-to-1 ratio on the Nasdaq.
The S&P index recorded 24 new 52-week highs and two new lows, while the Nasdaq recorded 46 new highs and 23 new lows.
Reporting by Medha Singh in Bengaluru; Editing by Shounak Dasgupta, Subhranshu Sahu and Saumyadeb Chakrabarty