Disappointing retail earnings drag on stocks

Associated Press

Disappointing quarterly results from Macy’s, Kohl’s and other big department store chains put investors in a selling mood Thursday, sending U.S. stocks modestly lower.

Stocks in the consumer discretionary sector, which includes many retailers, slumped the most. Macy’s plunged 14 percent. Kohl’s, Dillard’s and Nordstrom also fell sharply.

“Those retail numbers are weighing on the market,” said Quincy Krosby, market strategist at Prudential Financial. “Macy’s (results) came in well below what the market had expected and that has basically put a cloud over the brick-and-mortar retail across the board.”

Banks and real-estate companies were also big decliners. Consumer goods, health care and utilities stocks eked out small gains. Three stocks fell for every two that rose on the New York Stock Exchange. Oil prices rose.

The disappointing earnings from retailers set the major stock indexes on a downward trajectory early Thursday.

Despite the sluggish results from some department-store chains, corporate results for the first three months of the year have been positive. With about 89 percent of companies in the S&P 500 index having reported results so far, 51 percent have turned in better-than-expected earnings and revenue, according to CFRA Research. Technology, financials and materials companies have posted the biggest earnings growth.

The parent company of Snapchat was also among the big movers Thursday. Snap plunged 21.5 percent a day after it reported a huge loss. The stock slid $4.93 to $18.05.