Stock indexes closed little changed Friday, as the Nasdaq faced resistance at a key level and gains that looked great in early trading evaporated. In short, it was a disappointing session.
XThe Nasdaq composite, which opened more than 1% higher, closed only a fraction higher. The composite and the PowerShares QQQ Trust (QQQ) ETF met resistance at the 50-day moving average. In fact, QQQ's high today was almost exactly at the 50-day average of 164.40.
The S&P 500 rose 0.1%. The Dow Jones industrial average had a fractional loss, but closed near session highs. The Russell 2000 ended 0.1% lower. The Dow transports led 1.3% thanks to a 2% rise in the airline industry group and 1.5% gain in rails.
Volume fell from Thursday's totals, according to preliminary data. Advancers led decliners by 7-5 on the NYSE and were nearly even on the Nasdaq.
As indexes faded badly, so did several big-name stocks that initially rallied on earnings reports.
Amazon.com (AMZN) soared as high as 1,638.10, but pulled back to a 3.6% gain at 1,572.62. The stock was still above the 1,568.62 buy point of a cup-with-handle base. Amazon, a member of IBD Leaderboard, also topped a previous high of 1,617.54 momentarily. Citigroup and several other firms raised their price targets on Amazon.
Amazon's revenue surged 43% as adjusted earnings leaped 121% to $3.27 per share, beating expectations. Amazon also is raising the annual cost of its Prime memberships to $119 from $99.
Retail and regional banks were market leaders. Semiconductors, telecom services and defense were some of the groups dragging. Cable TV, part of the telecom services group, was Friday's weakest on new signs of decay.
Charter Plunges On Cord-Cutting
Charter Communications (CHTR) plunged after the company reported losses of video subscribers larger than expected. Charter said it lost 122,000 video subscribers, nearly triple analyst estimates of 43,000 fewer.
Charter shares plummeted 12% to a nearly 18-month low in huge volume. Comcast (CMCSA), the eighth largest stock on the Nasdaq, fell 4.6%. Altice USA (ATUS) dropped 9%. Comcast on Wednesday said it lost 96,000 video subscribers. Liberty Broadband (LBRDK), whose principal asset is its stake in Charter, plummeted 14%.
Restaurant stocks are emerging as a new area of leadership, even though the group was down about 2%. It climbed into the top 20 of 197 groups, from No. 49 position six weeks ago. Dine Brands Global (DIN) broke out past the 79.76 buy point of a cup-without-handle base in average volume.
Chipotle Mexican Grill (CMG) has soared about 30% since the company announced superb earnings late Wednesday. EPS smashed estimates and same-store sales growth of 2.2% also topped views. Ruth's Hospitality (RUTH), Texas Roadhouse (TXRH), Domino's Pizza (DPZ) and Shake Shack (SHAK) have climbed out of bases in the past few weeks.
Technology stocks faded. Intel (INTC) broke out of a base with a 53.88 buy point but reversed lower. It closed with a 0.6% loss. The chipmaker late Thursday beat first-quarter sales and earnings expectations and raised its full-year outlook.
Microsoft (MSFT) poked above the 97.34 buy point of a flat base, but retreated back into the base. The technology titan beat quarterly sales and profit views late Thursday. Shares were up more than 1% in afternoon trading.
Regional banks have been streaking higher, and SVB Financial (SIVB) gapped up to a record high, soaring 19% in big volume. The holding company of Silicon Valley Bank broke out past a cup-without-handle base after earnings topped expectations. Unlike other breakouts Friday, SVB closed at session highs.
Exxon Mobil (XOM) fell nearly 4% after the oil giant missed profit expectations. The loss contributed to the Dow's flagging action. Chevron (CVX), another Dow component, missed sales estimates but the stock climbed 2% in today's market.
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There was good news on the economic front. Gross domestic product climbed to a 2.3% annualized rate in the first quarter, down from a 2.9% increase in the prior quarter. But that still beat forecasts for a 2% rise.
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