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Disney jumps on Q1 beat, layoff plans
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PepsiCo gains on quarterly profit, sales beat
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Salesforce rises on reports Third Point owns stake
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U.S. weekly jobless claims increase
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Indexes down: Dow 0.22%, S&P 0.24%, Nasdaq 0.25%
(Updates prices, details; adds comments)
By Johann M Cherian and Ankika Biswas
Feb 9 (Reuters) - U.S. stock indexes turned lower by
early afternoon on Thursday as Alphabet shares extended declines
to another session, overshadowing gains in Disney after strong
earnings.
Wall Street's three main indexes opened higher after data
showed initial claims for state unemployment benefits rose
13,000 to a seasonally adjusted 196,000 last week, above a
forecast of 190,000 claims.
The data tentatively eased concerns about the Federal
Reserve's rate-hike path after a strong January employment
report rattled markets last week.
Weighing on the S&P 500 and Nasdaq indexes,
Alphabet Inc extended losses from the previous session
to fall 5.6%. The S&P 500 communication services sector sank 2.6%, while Alphabet shares eyed their worst
weekly performance since November.
The Google parent's new chatbot shared inaccurate
information on Wednesday, feeding worries that it is losing
ground to rival Microsoft Corp .
Meanwhile, Disney Co gained 1.6%, highest since late
August, after beating earnings estimates and announcing job
cuts, encouraging activist investor Nelson Peltz to terminate
his quest for a board seat.
"Wall Street wants to see companies taking action and
reducing costs and expenses. That's the name of the game right
now. Not great for employees, but certainly good for
shareholders," said Robert Pavlik, senior portfolio manager at
Dakota Wealth.
Salesforce Inc added 2.8% on reports that hedge fund
Third Point LLC owns a stake in the company.
At 12:53 p.m. ET, the Dow Jones Industrial Average was down 73.56 points, or 0.22%, at 33,875.45, the S&P 500 was down 10.01 points, or 0.24%, at 4,107.85, and the
Nasdaq Composite was down 29.41 points, or 0.25%, at
11,881.11.
Stocks have enjoyed an upbeat start to the year on hopes
that the Fed will abandon its hawkish rhetoric and pilot the
economy to a soft landing.
Traders are betting that the Fed will raise its benchmark
rate to a peak of 5.1% in July, largely in line with the
forecasts of Fed officials.
PepsiCo Inc rose 1.2% as the snack and beverage
maker reported better-than-expected results, while drugmaker
AbbVie Inc gained 3.1% after beating fourth-quarter
profit expectations.
Ralph Lauren Corp gained 1.2% after beating quarterly
sales expectations, while peer Tapestry Inc soared 5.4%
on a strong annual profit forecast.
More than half of the S&P 500 companies have reported
quarterly earnings so far, and 69% of them have beaten
estimates, according to Refinitiv data.
Cardiovascular Systems Inc soared 48.5% after
Abbott Laboratories said it would buy the medical device
maker for $837.6 million. Abbott fell 0.9%.
Declining issues outnumbered advancers for a 1.19-to-1 ratio
on the NYSE and a 1.52-to-1 ratio on the Nasdaq.
The S&P index recorded 15 new 52-week highs and one new low,
while the Nasdaq recorded 64 new highs and 39 new lows.
(Reporting by Sruthi Shankar, Medha Singh, Johann M Cherian and
Ankika Biswas in Bengaluru; Editing by Sriraj Kalluvila and
Shounak Dasgupta)
