Stocks were mixed Friday morning as investors digested the Commerce Department's positive read on third-quarter GDP growth and several big earnings reports
Dow industrials remained slightly higher while the S&P 500 fell fractionally and the Nasdaq lost 0.1%.
Early Movers: Amazon, Alphabet, McKesson, Baker-Hughes
Big-boned earnings reports powered early action on the stock market today. One exception was Baker Hughes (BHI). The oilfield equipment and services heavyweight spiked 5.5% after news reports that General Electric (GE) was discussing a possible takeover of the Houston company. GE clarified that it was only discussing potential partnerships, not a takeover. GE shares ticked up more than 1%.
Amazon.com (AMZN) dropped more than 4% after a 206% surge in third-quarter earnings stopped well short of views for a 359% gain. A 29% revenue increase met expectations. The midpoint of Amazon's fourth-quarter guidance was just below analysts' targets. Amazon ended Thursday in a buy range on a rebound from its 10-week moving average. The stock gapped below its 10-week moving average, a break of support.
Alphabet (GOOGL) rose more than 2%. Google's parent reported a 23% rise in earnings and a 20% revenue gain, both above expectations. The company also announced a $7 billion stock buyback initiative. The stock ended Thursday in a buy range above an 813.88 flat base buy point. It has had trouble getting lift above that level.
Drug makers and drug-related stocks were swinging wildly. Sanofi (SNY) hurtled ahead 4% after a solid third-quarter report, including a healthy increase in its full-year earnings guidance. Novo-Nordisk (NVO) plummeted nearly 15% after lowering guidance and warning of weaker insulin prices in the U.S.
Drug distributor McKesson (MCK) tanked 23% after reporting a big fiscal second-quarter miss late Thursday. Caught in the undertow, fellow drug distribution giants Cardinal Health (CAH) and AmerisourceBergen (ABC) also tumbled. AmerisourceBergen plunged 11% while Cardinal swooned 12%. The two companies report earnings next week.
Cirrus Logic (CRUS) logged a near-10% advance to 56.88. The Austin, Texas-based chip maker reported fiscal second-quarter revenue and earnings far above consensus expectations -- its first profit gain in five quarters. The stock is forming a flat base with a 58.18 buy point.
Q3 GDP Outpaces Estimates; Oil, Gold Slip
The economy expanded at a 2.9% clip in the third quarter, according to preliminary estimates from the Commerce Department. That was better than double the pace of growth in the second quarter and comfortably above consensus views for a 2.5% expansion. Price growth remained in check, with the GDP Price Index up 1.5% for the quarter, down from a 2.3% jump in the second quarter and in line with expectations.
The Labor Department's third-quarter Employment Cost Index rose 0.6%, equal to its second-quarter advance and in line with economist consensus targets.
At 10 a.m. ET, the University of Michigan reports October consumer sentiment and, at 1 p.m., Baker Hughes reports its weekly rig count.
Oil futures hung lower, with West Texas Intermediate off 0.9% to $49.26 a barrel. Gold reversed and added 0.7% to $1,270.20 an ounce. The dollar slipped vs. both the euro and the yen. Bonds fell, lifting the 10-year yield by 1 basis point to 1.86%.
Overseas, markets were quietly mixed. China's leading indexes posted minor losses Friday. Tokyo's Nikkei 225 added 0.6% to notch a 1.5% gain in its third advance in the past four weeks.
Stocks in Europe were mixed: the CAC 40 in Paris edged down 0.1% in afternoon trade. Frankfurt's DAX dipped 0.5% and the FTSE 100 in London slipped 0.3%.
RELATED:
