Wall Street opens flat, investors shrug off bank results - Metro US

Wall Street opens flat, investors shrug off bank results

Traders work on the floor at the New York Stock Exchange (NYSE) in New York, U.S., July 1, 2019. REUTERS/Brendan McDermid
By Medha Singh

By Medha Singh

(Reuters) – U.S. stocks treaded water on Wednesday as trade-related weakness hurt CSX Corp’s profit, leading to a decline in railroad stocks and offsetting gains in shares of Abbott and Qualcomm.

Shares of CSX recorded the steepest fall on the benchmark index, sliding 8.3% after the company posted lower-than-expected quarterly profit and cut its full-year revenue forecast.

Rivals Union Pacific Corp slipped 5.3% and Kansas City Southern fell 4%. Both companies will report results this week.

Losses in CSX also pushed the Dow Jones Transport Average <.DJT> down 2.5% and the industrials <.SPLRCI> about 1%, the most among six of the 11 S&P sectors that were in the red.

However, Abbott Laboratories rose 4% after the medical device maker topped quarterly profit estimates and lifted its full-year adjusted earnings forecast. It was the biggest boost to the S&P 500 index.

Since a sharp fall in May, Wall Street’s main indexes have been trending higher to hit record highs on hopes of interest rate cuts by the Federal Reserve.

However, nervousness returned to markets on Tuesday after U.S. President Donald Trump threatened to tax another $325 billion worth of Chinese goods.

“It’s hard for this market to push up substantially without some resolution on trade,” Rick Meckler, partner, Cherry Lane Investments in New Vernon, New Jersey, said.

At 10:03 a.m. ET, the Dow Jones Industrial Average <.DJI> was up 0.30 points, or unchanged, at 27,335.93, the S&P 500 <.SPX> was down 1.52 points, or 0.05%, at 3,002.52. The Nasdaq Composite <.IXIC> was up 4.64 points, or 0.06%, at 8,227.43.

Meckler said markets rose quickly on signs of dovish Fed policy, but investors may be inclined to pause with tensions on trade giving them a reason to not to commit any fresh capital.

Profit for S&P 500 companies is expected to dip 0.1% in the second quarter, the first drop in three years, according to Refinitiv IBES data.

Bank of America Corp rose 1.1% after reporting a profit beat, but lowered its annual net interest income guidance.

This follows similar warning signs from JPMorgan , Citigroup and Well Fargo , which reported a dip in margins and stoked fears of interest rate cuts pressuring profit.

Qualcomm Inc jumped 1.4% after the U.S. Justice Department asked a federal appeals court to pause the enforcement of a sweeping antitrust ruling against the mobile chip supplier.

Its gains, along with a strong quarterly profit from Dutch chip equipment maker ASML , helped the Philadelphia Semiconductor Index <.SOX> rise 0.5%.

Declining issues outnumbered advancers for a 1.49-to-1 ratio on the NYSE and a 1.30-to-1 ratio on the Nasdaq.

The S&P index recorded 18 new 52-week highs and no new low, while the Nasdaq recorded 29 new highs and 37 new lows.

(Reporting by Medha Singh in Bengaluru; Editing by Arun Koyyur)

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