U.S. Stocks Finish Choppy Trading Day Mostly Lower On Late-Day Weakness

Stocks showed a lack of direction throughout much of the session on Wednesday but came under pressure in the latter part of the trading day. The major averages spent most of the day bouncing back and forth across the unchanged before sliding more firmly into negative territory.

After reaching a new record intraday high in early trading, the tech-heavy Nasdaq fell 104.82 points or 0.6 percent to 18,607.93. The S&P 500 also dipped 19.25 points or 0.3 percent to 5,813.67, while the Dow slipped 91.51 points or 0.2 percent to 42,151.54.

The choppy trading seen for most of the trading day came as investors reacted to a mixed batch of corporate earnings and U.S. economic news.

Shares of Alphabet (GOOGL) jumped by 2.8 percent after the Google parent reported third quarter results that beat analyst estimates on both the top and bottom lines.

Snapchat parent Snap (SNAP) also soared by 15.9 percent after reporting better than expected third quarter results and announcing a $500 million stock repurchase program.

Meanwhile, shares of Advanced Micro Devices (AMD) plunged by 10.6 percent after the chipmaker reported third quarter revenues that beat expectations but provided disappointing fourth quarter revenue guidance.

Dow component Caterpillar (CAT) also slumped by 2.1 percent after the construction equipment maker reported weaker than expected third quarter earnings.

On the U.S. economic front, payroll processor ADP released a report showing private sector employment in the U.S. shot up by much more than anticipated in the month of October.

ADP said private sector employment surged by 233,000 jobs in October after jumping by an upwardly revised 159,000 jobs in September.

Economists had expected private sector employment to climb by 115,000 jobs compared to the addition of 143,000 jobs originally reported for the previous month.

However, a separate report released by the Commerce Department showed U.S. economic growth unexpectedly slowed in the third quarter.

The Commerce Department said gross domestic product shot up by 2.8 percent in the third quarter after surging by 3.0 percent in the second quarter. Economists had expected another 3.0 percent jump.

The unexpected slowdown in the pace of GDP growth primarily reflected a downturn in private inventory investment and a larger decrease in residential fixed investment.

Sector News

Semiconductor stocks pulled back sharply after rallying on Tuesday, dragging the Philadelphia Semiconductor Index down by 3.4 percent.

The steep drop by AMD weighed on the sector along with a nosedive by shares of Qorvo (QRVO), which plummeted by 27.3 percent after the company provided disappointing fiscal third quarter earnings guidance.

Substantial weakness was also visible among computer hardware stocks, as reflected by the 2.6 percent slump by the NYSE Arca Computer Hardware Index.

Shares of Super Micro Computer (SMCI) plunged by 32.7 percent after the tech company revealed Ernst & Young has resigned as its auditor.

Telecom, gold and steel stocks also moved notably lower on the day, while some strength remained visible among housing stocks.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region moved mostly lower on Wednesday. Hong Kong’s Hang Seng Index tumbled by 1.6 percent and China’s Shanghai Composite Index fell by 0.6 percent, while Japan’s Nikkei 225 Index bucked the downtrend and jumped by 1.0 percent.

The major European markets also moved to the downside on the day. While the U.K.’s FTSE 100 Index slid by 0.7 percent, the French CAC 40 Index and the German DAX Index both slumped by 1.1 percent.

In the bond market, treasuries gave back ground after seeing early strength, closing slightly higher. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, dipped less than a basis point to 4.266 percent after hitting a low of 4.198 percent.

Looking Ahead

Trading on Thursday may be impacted by reaction to reports on weekly jobless claims and personal income and spending, which includes the Federal Reserve’s preferred inflation readings.

On the earnings front, Meta Platforms (META), Microsoft (MSFT), Amgen (AMGN), eBay (EBAY), DoorDash (DASH) and Starbucks (SBUX) are among the companies reporting their quarterly results after the close of today’s trading.

Bristol-Myers (BMY), Comcast (CMCSA), MasterCard (MA) and Uber (UBER) are also among the companies due to report their quarterly results before the start of trading on Thursday.