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Stock Market News For Oct 26, 2017

Markets tanked on Wednesday after the Dow and the S&P 500 suffered their worst single-day declines in almost seven weeks. The Dow declined after shares of Boeing nosedived following a steep rise in its production cost. The S&P 500 ended in the red after a decline in shares of Advanced Micro Devices and Chipotle Mexican Grill weighed heavily on the benchmark. Meanwhile, new home sales and durable orders for September came in above the consensus estimate.

The Dow Jones Industrial Average (DJIA) closed at 23,329.46, declining 0.5%. The S&P 500 Index (INX) decreased 0.5% to close at 2,557.15. Meanwhile, the Nasdaq Composite Index (IXIC) closed at 6,563.89, decreasing 0.5%. Declining issues outnumbered advancers on the NYSE by 1,674 to 878. On the Nasdaq, decliners outnumbered advancers by 1,310 to 936. The CBOE VIX increased 0.5% to close at 11.21.

Dow, S&P 500 Post Their Biggest Losses in Two Month

Dow shed 112.30 points on Wednesday to post its biggest loss in about seven weeks. The blue-chip index suffered such losses after shares of aerospace giant, Boeing BA, tanked 2.9% following a decline in revenues of two of its business units, as compared to the last year. The company stated that it had incurred $329 million in costs due to problems associated with production of its KC-46 aerial refueling tanker. This marked the Dow’s biggest single-day dip since Sep 5, 2017 when the blue-chip index swooned 1.1% in a single day.

Meanwhile, the S&P 500 lost almost 12 points to end in negative territory. All Of the 11 major sectors of the S&P 500 ended in the red with industrial and energy shares leading the decliners. The Industrial Select Sector SPDR ETF (XLI) and the Energy Select Sector SPDR ETF (XLE) declined almost 1% and 0.7%, respectively. The S&P 500 also registered its worst day since Sep 5, the biggest drags on the benchmark being shares of Advanced Micro Devices AMD and Chipotle Mexican Grill CMG. Shares of AMD and CMG declined 13.5% and 14.6%, respectively. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Advanced Micro Devicesreported non-GAAP earnings of 10 cents per share compared with 3 cents per share in the year-ago quarter. The figure also surpassed the Zacks Consensus Estimate of 8 cents per share.  Revenues increased 26% year over year and 34% sequentially to $1.64 billion and exceeded the Zacks Consensus Estimate of $1.51 billion. (Read More)

Meanwhile, shares of Chipotle Mexican Grilldeclined nearly 10% in afterhours trading on Oct 24, after the company reported lower-than-expected third-quarter 2017 results. An expected slowdown in new restaurant openings led to the slump in the stock price. Chipotle reported earnings of 69 cents per share, up significantly from the prior-year quarter earnings of 27 cents per share. (Read More)

Trump Keeps Investors on Tenterhooks

Amidst much speculation regarding who will go on to head the Fed, investors eagerly wait for President Trump’s decision to choose Janet Yellen’s successor, post the expiration of her term as the Fed Chief in February, 2018. In a surprising move, Trump sought help of the Senate Republicans on Tuesday to zero in on a potential candidate for the post of Fed Chief. In a show-of-hands, Senators from the GOP unanimously vouched for Stanford University Professor John Taylor to be the next Chief of Fed. Trump would reportedly announce the name of Yellen’s successor officially before he heads out on a trip to Asia. Some experts commented that ‘show-of-hands’ might possibly be a decisive factor affecting Trump’s decision.

Meanwhile, broader markets gained from positive investor sentiment due to hopes that the existing tax code would soon be amended. The green signal to the budget blueprint ensures taxpayers that existing tax codes would be rewritten, more so because it has unlocked a procedure using which President Trump and his team can push through their tax reforms using only Republican votes.

Economic Data

On the economic data front, new home sales surged to 667,000 in September, up from 561,000 in August — an increase of 18.9% from the previous figure. The consensus estimate for the period was an increase of 557,000. Meanwhile, durable orders increased 2.2% in September, up from 2% in August. The consensus estimate for the period was an increase of 1.2%.

Stocks That Made Headlines

Suncor Earnings Top Estimates in Q3, Revenues Up Y/Y

Canadian energy giant Suncor Energy Inc. SU reported third-quarter 2017 operating earnings per share surpassing the Zacks Consensus Estimate. (Read More)

TechnipFMC Misses on Q3 Earnings, Sales Decline Y/Y

Energy services company TechnipFMC plc FTI reported third-quarter 2017 earnings on a diluted basis, missing the Zacks Consensus Estimate. (Read More)

Tractor Supply (TSCO) Beats on Q3 Earnings, Raises Guidance

After missing both earnings and sales estimates in the second quarter of 2017, Tractor Supply Company TSCO reported better-than-expected results in the third quarter. (Read More)

Xilinx Q2 Earnings Beat, Revenues in Line, Stock Down

Xilinx Inc. XLNX reported second-quarter fiscal 2018 earnings of 65 cents per share, which beat the Zacks Consensus Estimate by three cents.  (Read More)

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