Dow closes nearly 100 points lower to snap 3-day win streak, dragged down by weak earnings: Live updates

Alex Harring
Sarah Min
A trader works on the floor at the New York Stock Exchange on Dec. 4, 2023.

The Dow Jones Industrial Average fell Tuesday, pulling back from record-breaking highs as traders pored through the latest batch of corporate earnings.

The blue-chip Dow slid 96.36 points, or 0.25%, to 37,905.45, retreating below the 38,000 level that was crossed for the first time on Monday. Tuesday's losses ended a three-day winning streak.

The S&P 500 rose by 0.29% to 4,864.60, a fresh all-time closing high. The technology-heavy Nasdaq Composite advanced 0.43% to 15,425.94.

The 30-stock Dow was pressured by an 11% decline in 3M following disappointing guidance. Johnson & Johnson fell 1.6% after reporting earnings.

D.R. Horton dropped more than 9% after the homebuilder missed Wall Street's consensus forecast for per-share earnings. Lockheed Martin slipped more than 4% following a weak outlook for full-year earnings per share.

On the other hand, United Airlines rose more than 5% after reporting strong fourth-quarter results. However, the airline operator said it expects a first-quarter loss from the grounding of Boeing 737 Max 9 airplanes, the model involved in the Alaska Airlines emergency earlier this month.

Shares of other airline operators rose in tandem. Southwest Airlines climbed more than 3%, while American Airlines, Delta Air Lines and Alaska added more than 2%.

Elsewhere, Verizon and Procter & Gamble helped mitigate losses for the Dow. The pair gained more than 6% and 4%, respectively, as investors bought in following the companies' financial reports.

Those moves come after the S&P 500 officially entered a new bull market, topping its previous closing all-time high from January 2022.

But investors are deliberating how long the gains can persist, especially as the rally this year has centered around technology stocks such as Nvidia, lacking broader participation. This month alone, Nvidia is up 20%. In contrast, the small-cap Russell 2000 is lower by more than 2%.

"Investors definitely are taking a pause — doing some profit taking — on the heels of what was a really a two-year record high," said Greg Bassuk, CEO of AXS Investments, of Tuesday's moves. "That's counterbalancing the bullishness in the markets."

Traders are also awaiting two key data economic data releases later in the week. The preliminary fourth-quarter gross domestic product figure is due Thursday, followed by the Commerce Department's closely-watched personal consumption expenditures price index for December on Friday.

Investors will monitor Netflix earnings after the bell on Tuesday. Technology remains a focus later in the week, with IBM and Tesla slated for Wednesday and Intel expected Thursday. Outside of tech, results from American, Alaska and Southwest are also due Thursday.

"Corporate earnings is going to be probably the most important thing we see this quarter other than what, ultimately, GDP and inflation looks like," said Alex McGrath, chief investment officer at NorthEnd Private Wealth. "I talked a lot last year about the health of the consumer. And I think that is going to be what comes most into focus at the first part of this year."

Tue, Jan 23 2024 4:06 PM EST

Dow closes lower, while S&P 500 notches new all-time closing high

The Dow finished down, while the S&P 500 clinched yet another all-time closing high.

The blue-chip average closed about 0.3% in the red. Meanwhile, the broad S&P 500 rose 0.3% to a new record closing level.

The Nasdaq Composite also ended the session higher, advancing 0.4%.

— Alex Harring

Tue, Jan 23 2024 3:31 PM EST

Expect some near-term softening before stocks land on solid ground, Citi says

2024 should be a tale of two halves, according to Citi's Scott Chronert.

"Following the strong Q4 2023 rally, pullbacks should be expected, and bought into, as a shifting Fed narrative unfolds," the equity strategist wrote, underscoring that investors should ready themselves for dynamic market conditions.

Chronert has a mid-year target of 4,800 for the S&P 500, implying that the broader market index could slide 1% from its current level. On the other hand, the strategist's year-end target of 5,100 means the benchmark could rally more than 5% from here.

The key to equity performance in 2024 will be market broadening, with a clear cluster of leaders outperforming lagging stocks. In particular, Chronert is overweight cyclical stocks over their defensive counterparts.

— Lisa Kailai Han

Tue, Jan 23 2024 3:22 PM EST

Alcoa climbs, on track for best day since mid-December

Aluminum stock Alcoa jumped nearly 7% on Tuesday and was on track for its best day in more than a month.

See Chart...
Shares of Alcoa rose sharply on Tuesday.

The move comes after a Politico report that said Russian aluminum products could be part of a new sanctions from the European Union. The report cited EU diplomats.

Alcoa was not the only aluminum stock rising on Tuesday. Shares of smaller rival Century Aluminum jumped more than 10%.

— Jesse Pound

Tue, Jan 23 2024 3:16 PM EST

Earnings season could lead to repositioning, says Bank of America

As earnings season gains steam, long-only funds have raised their exposure to equities and reduced their cash levels, per Bank of America. 

Across all global regions in 2024, funds have reduced their cash levels by at least 1% and increased their stock exposure across all sectors with the exception of tech and consumer discretionary, according to strategist Nigal Tupper.

"If the nascent earnings recovery gathers pace, funds could add meaningfully to cyclical sectors and regions, and equity markets in general," Tupper wrote in a Tuesday note.

— Hakyung Kim

Tue, Jan 23 2024 3:00 PM EST

Dow stays down entering final hour

The Dow remained lower, pulling back from its record-breaking high set in the previous session, as the final hour of Tuesday's trading day commenced.

The blue-chip average was down by around 0.2% shortly after 3 p.m. ET. The S&P 500 and Nasdaq Composite rose by about 0.2% and 0.3%, respectively.

— Alex Harring

Tue, Jan 23 2024 2:30 PM EST

History suggests S&P 500 rally could continue, says Bank of America's Suttmeier

If history is any guide, the S&P 500 may look poised to continue its 2024 uptrend, according to Bank of America.

"It took 24 months to achieve this new high, which is consistent with the median number of 25 months to hit a new high on a rally after a big correction," said the firm's technical research strategist Stephen Suttmeier in a Monday note.

The S&P's 38% rally from the October 2022 lows also aligns with the median move during a big correction of 40.5% from a low back to the old high, he said. The median S&P rally from a big low is 106% over a four-year period and lasts about 49 months, he added.

While the S&P may be aligning with historical patterns, its acks the "bullish confirmation" for cumulative net up volume, Suttmeier wrote. He called an upside breakout for this volume indicator a "missing ingredient for the bulls."

"We think that an upside breakout for cumulative net up volume is a much-needed bullish confirmation signal if the SPX is to continue to rally in 2024," he said.

— Samantha Subin

Tue, Jan 23 2024 2:01 PM EST

Money supply measure spiked in December, Fed data shows

A broad-based measure of the money supply expanded to its highest level since March 2023, according to Federal Reserve data released Tuesday.

A component known as M2, or cash, checking deposits, savings and other instruments that easily can be converted to cash, totaled $20.87 trillion. On a monthly basis, that is a 0.5% pickup from November.

While the monthly numbers can be volatile, the increase comes as with the Federal Reserve tightening the supply of bank reserves through its balance sheet runoff. Money stuck measures such as M2 are considered one potential measure of inflation.

—Jeff Cox

Tue, Jan 23 2024 1:32 PM EST

Wells Fargo warns about overly optimistic market

Investors who had pushed stocks to record highs on the hopes for lower interest rates and stronger corporate earnings are in for a letdown, according to Wells Fargo market strategists.

"We believe the market's disappointment upon realizing that its investment case is built on hope rather than reality will lead markets to pull back," the firm said in a client note Tuesday. "Our view is that earnings for all equity classes peaked and will move lower as the economy weakens and revenue growth stalls. In the near term, we expect pressure on earnings as well as prices with bouts of weakness and range trading."

Traders have begun to recalibrate their outlook for aggressive Federal Reserve rate cuts this year, though they are still pricing in at least five this year, according to the CME Group. On the earnings front, some 87% of S&P 500 companies that have reported earnings so far topped Wall Street estimates, though the beat rate on sales is just 58%, according to LSEG I/B/E/S.

—Jeff Cox

Tue, Jan 23 2024 1:03 PM EST

United Airlines, 3M among Tuesday's biggest movers

These are some of the stocks moving the most during Tuesday's session:

Read the full list of stocks on the move here.

— Samantha Subin

Tue, Jan 23 2024 12:21 PM EST

Oil prices flat on mixed supply, geopolitical signals

Oil prices were largely flat Tuesday as traders tried to decipher mixed signals in the Middle East and threats to crude supplies.

The West Texas Intermediate contract for March rose 21 cents, or .28%, to trade at $74.97 a barrel on Tuesday, while the Brent crude contract rose 5 cents, or .06%, to trade at $80.11. U.S. crude was down more than 2% earlier in the trading session.

Israel has proposed a two-month pause of fighting in Gaza in exchange for the release of the remaining hostages, according to NBC News. But Hamas has rejected the offer, according the Associated Press.

Oil prices had risen about 2% on Monday on potential threats to crude supplies. Ukrainian drones reportedly struck a major Russian fuel terminal on the Baltic Sea over the weekend, and the U.S. and Britain launched renewed airstrikes against the Houthis in Yemen on Monday.

Oil output in the U.S. has also taken a hit from the cold weather, with production in North Dakota down about 400,000 barrels per day as of Friday. The outage in the U.S. is tempered by Libya restarting production at the Sharara oilfield, which as a capacity of 300,000 barrels per day.

— Spencer Kimball

Tue, Jan 23 2024 11:46 AM EST

Earnings cause divergence among Dow members

The Dow fell more than 100 points in Tuesday's session as investors parsed earnings reports from a handful of index members.

3M dragged on the blue-chip average with a drop of more than 11%, on track for its third biggest loss in history and worst day since April 2019. The selloff came after issuing disappointing full-year and first-quarter guidance.

Johnson & Johnson also pulled the index down, sliding 1.5% despite beating Wall Street forecasts on both lines in the fourth quarter.

But losses were mitigated by rallies on the back of other members' reports. Verizon led the index higher with a gain of more than 5% following a better-than-expected report. Procter & Gamble followed, up more than 4% as investors keyed in on earnings per share that came in better than analysts anticipated.

See Chart...
The Dow, 1-day

— Alex Harring

Tue, Jan 23 2024 11:25 AM EST

Richmond Fed manufacturing sees decline in January

Manufacturing in the northern Virginia area showed weaker than expected activity in January, the Richmond Federal Reserve reported Tuesday.

The central bank district's manufacturing survey for the month showed a reading of -15, representing the difference between companies reporting expansion against contraction. That showed a decrease from -11 in December and a miss of the -8 consensus estimate from Dow Jones.

Much of the decline came from slides in capacity utilization and order backlogs. The hiring index tumbled to -15 from -1 and the wages index increased to 30, a gain of 8 points. Prices paid and received indexes showed little change.

Earlier in the day, the Chicago Fed reported that its Survey of Economic Conditions improved to a plus-7 reading, up from -17 in December. Positive numbers in the survey represent above-trend growth.

—Jeff Cox

Tue, Jan 23 2024 11:02 AM EST

Wolfe Research still doesn't believe in 'immaculate everything' scenario for economy

Wolfe Research isn't convinced that economic concerns are in the rearview mirror.

Chris Seynek told clients Tuesday that there's several reasons why inflation could come in higher than market participants expect. These potential catalysts include geopolitical issues such as the Red Sea attacks, which he said could push up commodity prices and transportation costs. as well as disrupt supply chains.

"Major U.S. stock market indices are hitting new all-times, with widespread consensus now expecting inflation to keep collapsing, the Fed to cut deeply, and the U.S. economy (at worst) to glide down for a 'soft landing,'" Seynek told clients. "While our view is currently unpopular, we're still not believers in the 'immaculate everything' scenario."

Seynek's note comes ahead of key economic data releases on gross domestic product and the personal consumption expenditures price index due later this week.

— Alex Harring

Tue, Jan 23 2024 10:30 AM EST

Solar ETF heads for best day since December

The Invesco Solar ETF (TAN) popped more than 4% on Tuesday and headed for its best day since Dec. 21, when it rallied 4.8%.

Canadian Solar was the biggest gainer in the index, popping 13%. JinkoSolar and SunPower rallied more than 7% each, while Sunnova Energy gained about 5%.

The rise in solar stocks came as Truist Securities upgraded both Sunnova Energy and Enphase Energy to buy ratings, saying that residential solar stocks are approaching a bottom after a rough 2023, and that the Federal Reserve cutting interest rates should benefit these names.

See Chart...
The Invesco Solar ETF, 1-day

— Samantha Subin, Gina Francolla

Tue, Jan 23 2024 10:00 AM EST

Health care, energy and utilities could see multiples grow this earnings season, says DCLA's Sethi

Market and investors' gains in the coming weeks could come down to earnings results, according to Sarat Sethi, DCLA managing partner and portfolio manager.

The investor cited sectors such as healthcare, energy and utilities as sectors that have suffered because of the markets' concerns that interest rates may not fall as quickly as expected. However, Sethi believes earnings season could mark a pivot point for these sectors.

"If they have strong earnings or they just keep up with earnings expectations, you could see multiples expanded those areas where you've actually seen multiple compression," Sethi told CNBC's "Squawk on the Street" on Tuesday.

To be sure, he added that investors should still be exposed to the Magnificent 7.

"On the Magnificent Seven, I think you still have to be in there. It's just a question of: How much do you want to own those, especially with the expectations built in? They have to really have really good earnings and actually increase their expectations," Sethi said.

— Hakyung Kim

Tue, Jan 23 2024 9:33 AM EST

Dow opens lower after Monday's record-breaking climb

The three major stock indexes were mixed as trading kicked off.

The Dow slipped 82 points, or 0.2%, shortly after 9:30 a.m. ET. That marked a pullback after the blue-chip average topped the 38,000 level for the first time ever on Monday.

On the other hand, the S&P 500 and Nasdaq Composite rose 0.1% and 0.2%, respectively.

— Alex Harring

Tue, Jan 23 2024 8:43 AM EST

Stocks making the biggest premarket moves

These are some of the stocks making notable moves before the bell:

  • Coinbase — The cryptocurrency exchange slipped nearly 4% following a downgrade to underweight earlier on Tuesday from JPMorgan. The bank said 2024 could be a tough year for Coinbase as enthusiasm for spot Bitcoin ETFs fades.
  • General Electric — Shares of General Electric were down nearly 7% in the premarket after the industrial giant issued weaker-than-expected guidance for the first quarter. The company sees earnings per share ranging between 60 and 65 cents, well below an LSEG estimate of 72 cents per share.
  • SunnovaEnphase Energy — The two solar companies were higher in premarket trading after Truist upgraded them to buy from hold. Shares of Sunnova climbed added more than 6%, while Enphase ticked up 4%. Truist said both stocks should get a boost from Federal Reserve rate cuts later this year.

Read the full list here.

— Brian Evans

Tue, Jan 23 2024 8:19 AM EST

D.R. Horton shares slide after reporting mixed results

Shares of D.R. Horton fell nearly 5% after the homebuilder reported an earnings miss before the bell Tuesday.

Earnings per share for the first quarter came in at $2.82, below the $2.88 expected from analysts polled by LSEG. However, D.R. Horton's revenue for the quarter was $7.73 billion, topping the consensus estimate of $7.59 billion.

The stock is up nearly 4% year to date, after gaining a whopping 70.5% in 2023.

— Michelle Fox

Tue, Jan 23 2024 7:58 AM EST

Netflix, TKO Group shares rise on plan to stream WWE's RAW on streaming giant

Shares of Netflix and TKO Group Holdings jumped in premarket trading Tuesday after the companies announced a deal to air WWE's flagship Raw program beginning next year on the streaming giant.

The 10-year deal, valued at more than $5 billion according to a person familiar with the matter, marks Netflix's first major entry into the live sports business.

Shares of TKO, which is the parent company of WWE, surged 19% before the bell. Netflix shares gained more than 2%.

Disclosure: Comcast NBCUniversal, CNBC's parent company, owns USA Network, where Raw has been a top program.

See Chart...
Shares pop on Netflix deal

— Samantha Subin, Alex Sherman and Jacob Pramuk

Tue, Jan 23 2024 7:52 AM EST

Halliburton stock rises early Tuesday morning despite mixed fourth-quarter results

Shares of Halliburton rose 2% before Tuesday's opening trading bell after the energy services company posted mixed results for its fourth quarter.

Halliburton posted adjusted earnings of 86 cents per share, versus the 80 cents per shares expected by analysts polled by LSEG. On the other hand, the company's fourth-quarter revenue of $5.75 billion fell short of the $5.78 billion analysts had been anticipating.

Shares have dropped nearly 5% thus far in 2024, adding to last year's drop of more than 8%.

— Lisa Kailai Han

View the full site