Dow Jones wiped out nearly 100 points amid the ongoing Boeing crisis following the 737 MAX 8 crash in Ethiopia and the increasing fears for Hard Brexit. However, other Wall Street indexes ended into the green.
The blue-chip index Dow Jones Industrial Average dropped by 96.22 points, or 0.38%, closing the session at 25,554.66 points. The broader S&P 500 rose by 0.30% to 2,791.52 points, while the technology index Nasdaq Composite rose by 32.97 points, or 0.44%, to 7,591.03 points.
Boeing shares fell by more than 6% after they wiped out 5.4% on Monday, registering the biggest two-day loss since June 2009.
On Sunday, the Boeing 737 MAX 8 plane crashed in Ethiopia, killing 157 people.
The NYSE Arca Airline Index fell by 0.9% on Tuesday. On Monday, the index had gained 1.2% to snap a nine-session losing streak.
Earlier today, the European Union is temporarily suspending flights with this model until the situation is clarified.
Investors’ focus was also on news of the unexpected slowdown in US core inflation in February amid a fall in car and prescription medicine prices. This gives the Federal Reserve a stimulus to stick to its policy of patience in raising key interest rates.
Without food and energy, the so-called core consumer price index rose by 0.1% in February compared to the previous month and 2.1% year-on-year. This data was inconsistent with analysts’ average estimates of sustaining the rate of inflation acceleration by 0.2% per month and by 2.1% on an annual basis.
Earlier this evening, the British Parliament again rejected the revised Brexit agreement with Prime Minister Theresa May, which she managed to negotiate with the EU on Monday.
According to the EU’s Brexit negotiator, Michel Barnier, the UK will not have a transitional period after its exit without a deal to be ratified by the British Parliament.
“Listening to the debates in the House of Commons, it seems to me that there is a dangerous illusion that Britain can benefit from a transitional period in the absence of an agreement to leave the EU”, said Michel Barnier. “Let me be clear, the only legal basis for a transitional period is an agreement to leave the EU. If there is no Brexit agreement, then there will be no transitional period”, added he.
On this background, the yields on 10-year and 30-year US Treasury bonds fell to 2.60% and 2.989%, respectively.
Corporate stocks performance
The stocks of airlines are among the worst performing during the day. The stocks of American Airlines dropped by 3.5%, while those of United Continental Holdings, which operates United Airlines, fell by 3%.
Microsoft stock advanced 0.7%. The stocks of Apple climbed 1.1% after a 3.5% surge Monday. Finally, Google stock rallied 1.5%, hitting a five-month high in above-average volume.
The broader tech market was also propped up by gains in semiconductor stocks thanks to Nvidia and Advanced Micro Devices, which advanced by 0.86% and 2.31%.
Gains in retailers, meanwhile, were stifled by a slump in Dick’s Sporting Goods as the retailer’s downbeat outlook and weak margin growth offset better-than-expected fourth-quarter results. Shares of the company fell by 11%.
Devon Energy, Whirlpool and Newmont Mining were among the top S&P 500 gainers for the session.
Corporate earnings reports
Saga Communications reported Q4 earnings per share (EPS) of 0.72 USD, versus 2.52 USD reported last year. The company’s revenue for the quarter came in at 32.9 million USD, versus 31.46 million USD reported last year. The net revenue increased by 4.7% to 32.9 million USD for the quarter ended December 31, 2018. The income from continuing operations before tax increased 2.3 million USD to 6.0 million USD compared to 3.7 million USD last year. Meanwhile, the operating income of Saga Communications increased by 2.1 million USD to 6.0 million USD.
The maker of cancer diagnostics tests Guardant Health reported a loss of 0.30 USD per share for the fourth quarter, beating analysts expectations. Revenue rose 64% to 32.87 million USD, also beating forecasts. For 2019, Guardant Health sees revenue rising 43%-39% to 130-135 million USD versus views for 116 million USD. Guardant Health stock rose 2.7% in late trade, which would mark a new high. Guardant Health stock already surged 11% in Tuesday’s session, an all-time best and up 289% since coming public.