U.S. stocks close lower; curbing October gains
U.S. stocks finished lower on Thursday, with Wall Street knocking out another month of gains, as investors mulled corporate earnings and pondered the timing of reduced monetary stimulus by the Federal Reserve.
Two days after both the Dow and the S&P 500 closed at record highs, equities fluctuated between modest gains and losses during the session before finishing at or near session lows. Traders were rattled after a report on CNN, later picked up by the wires, that quoted an unidentified U.S. official as saying Israeli warplanes had attacked a Syrian military base. The Israeli government reportedly declined to confirm the attack.
The Dow Jones Industrial Average lost 73.01 points, or 0.5 percent, to close at 15,545.75, leaving it up 3.2 percent for October. Blue-chip losses were led by Visa after the card-payment network reported less-than-expected revenue.
The S&P 500 fell 6.77 points, or 0.4 percent, to 1,756.54, up 4.8 percent from the month-ago close. The Nasdaq Composite fell 10.91 points, or 0.3 percent, to 3,919.71, giving it a 3.9 percent monthly gain.
Financials led sector losses and consumer discretionary fronted gains among the S&P 500's 10 major industry groups.
Shares of Starbucks fell after the coffee retailer reported sales growth contracted in Asia. Expedia and Facebook both gained after reported quarterly earnings that exceeded estimates. Exxon Mobil was among Dow gainers after the oil producer reported adjusted third-quarter earnings that topped estimates.
"The reality is you have a number of earnings reports that weren't the best," said Dan Greenhaus, chief global strategist at BTIG."Out of the 66 companies I have that reported last night or today, a little more than half are down, and by an average of 5.5 percent. Much more than the companies that are up, by the average of 3.7 percent. So the misses are doing much worse," said Greenhaus.
For every two shares rising, roughly three fell on the New York Stock Exchange, where 908 million shares traded. Composite volume neared 3.9 billion.
The yield on the 10-year Treasury note used in determining mortgage rates and other consumer loans rose 2 basis points to 2.56 percent, while the dollar gained against currencies of major U.S. trading partners.
Stocks briefly jumped after a barometer of business activity in the Chicago region climbed for a fourth month to 65.9 from 55.7 in September.
The upbeat report on Chicago factory activity should be taken with a "very large grain of salt as it squares with no other data seen," Peter Boockvar, chief market analyst at the Lindsey Group, noted in emailed comments.
"Nobody believes the Chicago PMI. Secondly, it becomes a function of good news is bad news. Does it mean the Fed pulls back," added Greenhaus.
Also Thursday, the Labor Department reported fewer Americans filed initial claims for jobless benefits last week, with the government's count declining by 10,000 to 340,000.
On Wednesday, the Fed said it would maintain its $85 billion in monthly bond purchases, noting signs of underlying improvement in the economy but adding it wants to see further signs of improvement before it begins slowing stimulus.
—By CNBC's Kate Gibson
Coming Up This Week:
FRIDAY: Fed's Bullard speaks, PMI manufacturing index, ISM manufacturing index, Fed's Kocherlakota speaks, auto sales; Earnings from Chevron
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