Markets Right Now: Weak earnings pull U.S. stocks lower

US stocks fell sharply at the open

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Trader Tommy Kalikas works on the floor of the New York Stock Exchange, Thursday, Sept. 20, 2018.

Other major companies also fell sharply.

Disappointing quarterly results and outlooks have stoked investors' jitters over future growth in corporate profits, a key driver of the stock market. "Earnings have helped", said Robert Pavlik, chief investment strategist and senior portfolio manager at SlateStone Wealth LLC in NY. The Commerce Department said orders to U.S. factories for major manufactured goods grew in September, and the increase was larger than analysts expected.

Charts for the entire region were awash with the red that indicates losses, but the declines were mostly in the 2 per cent to 3 per cent range.

Big earnings gains for several USA companies helped encourage investors to start hitting the "buy" button again.

It follows another poor lead from Wall Street overnight where the Dow Jones lost more than 600 points and the Nasdaq fell 4.4 per cent.

The S&P 500 had index plunged 9.2 per cent since October 3 as investors anxious about climbing interest rates and the effects of the US-China trade dispute. Facebook Inc fell 3.9 percent, Apple Inc slid 2.1 percent and Netflix Inc dropped 5 percent.

Responding to the healthy growth, the Federal Reserve has raised interest rates three times this year and is expected to hike them again in December. The two quarters marked the strongest consecutive quarters of growth since 2014. Natural gas declined 1.4 percent to $3.17 per 1,000 cubic feet.

Ford Motor, which is struggling with sales in China, surged 7.4 percent as its earnings report raised hopes for a strong finish to the year, while Raytheon was up 1.2 percent after the USA defence contractor raised its full-year forecast. "I think tech is just caught up in it today". The last S&P 500 correction happened in February. A correction is when shares drop at least 10 percent from their recent highs. She expects that to change when the dust settles.

The most recent bear market began in 2007, when the USA financial crisis crippled everything from the housing market to stock market investors.

Stock markets turned higher in European trading Thursday as investors settled somewhat after steep declines in Asia and the USA spurred by worries over trade and the US economy. But huge companies like Microsoft have slumped this month.

Rising rates and the trade dispute could both impair economic growth, and some encouraging economic news helped stabilize markets.

The Russell 2000 is down 73.34 points, or 4.8 percent.

The market rout continued on Wall Street on Friday.

The Nasdaq dropped 151 points, or 2.1 percent, to 7,167.

Germany's DAX added 0.3 per cent to 11,224 and the CAC 40 in France climbed 1.3 per cent to 5,015.

The Dow is down 135.80 points, or 0.5 percent. The S&P discretionary index fell 3.6 per cent.

The Commerce Department said sales of new USA homes plunged 5.5 percent in September, the fourth monthly drop.

Banks, health care and industrial companies also took heavy losses, outweighing gains by utilities and other high-dividend stocks. Japanese telecom and energy giant Softbank lost 4.4 per cent.

Major equity indexes in the USA started the day on the back foot and extended their slide before staging an unimpressive recovery in the second half of the session.

Benchmark US crude rose 0.8 per cent to US$67.33 a barrel. Brent crude, the benchmark for worldwide oil prices, rose 0.5 percent to $76.56 a barrel in London.

Toyota Motor Corp. gave up 2.7 per cent while Hong Kong-based retail supply chain giant Li & Fung Ltd. lost 1.3 per cent.

The S&P 500 added 49 points to 2,705 as of 2 p.m.

Gold rose 0.3 per cent to $1,235.80 an ounce. Copper dipped 0.1 percent to $2.75 a pound.

The dollar fell to 111.85 yen from 112.61 yen on Thursday.

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