The three day consecutive winning streak by Wall Street stocks ended on February 6 as the Standard & Poor 500 broke its winning streak after reports of mixed earnings. The DJIA or Dow Jones Industrial Average dropped 19.04 points and ended at 20,052.42. This happened as the gains made by United Technologies Corp was less than losses made by Verizon Communications Inc. shares.
Up and down stock movement
According to Diane Jaffee of TCW, financial stocks continue to have a potential upside as they could be beneficiaries of the roll back of Dodd-Frank regulations. Stocks of financial companies have pushed the S&P 500 and the Dow higher. She added that the large gains made in finance are fine if it is considered that the stocks showed near zero movement until election time. The stocks could still be considered cheap when contrasted with the market. There will be space for the stocks to increase their price with rise in earnings.
The Standard & Poor 500 dipped 0.2 percent or 4.86 points to end at 2,292.56. The losses were led by the telecommunications and energy sectors. The Nasdaq Composite slid to 5,663.55, a dip of 3.21 points. The bad performance is primarily attributed to the tumultuous activities at the White House. Investors have exhibited jittery behavior after the Trump administration had announced a number of controversial policy announcements. One of them is a travel ban applicable to citizens from seven majorly Muslim countries.
Causes and individual shares
Economic data was not published on February 6. Michael Antonelli of Robert W. Baird & Co said that the economy is really quiet even in the face of peak highs. He surmised that the dip was for simple profit extraction. Dow re-reached its 20,000 mark during the end of first week of February. This happened after it was announced by the Trump administration that it would roll back all Dodd-Frank regulations. Bank shares are stronger and non-farm payrolls figures are healthier.
Among individual stocks, the shares of Hasbro Inc. went up by 14 percent post reporting above expectations profits and sales. Tiffany & Co shares dipped 2.5 percent post the announcement made by the premium jewelry retailer that Frederic Cumenal, its Chief Executive Officer, has stepped down from the post. He has worked for 22 months in the role. Tyson Foods shares dropped 3.5 percent even after the company achieved better than anticipated earnings after it was heard that Securities and Exchange Commission has issued a subpoena against it.