Energy, tech companies help pull US stocks lower

Stock information was displayed Thursday inside Nasdaq’s Times Square offices.
Stock information was displayed Thursday inside Nasdaq’s Times Square offices.Drew Angerer/Getty Images/Getty Images

Energy stocks led a broad slide on Wall Street Thursday as oil and gas prices fell, handing the market its second straight loss.

Losses in technology and communications stocks also helped power the sell-off, offsetting gains by health care and real estate companies. Banks also rose, getting a boost from rising bond yields, which allow lenders to charge higher interest on loans.

The market’s downward tilt came as investors continued to weigh remarks on Wednesday by the head of the Federal Reserve that appeared to dim prospects for an interest rate cut this year.

‘‘You got a continuation of what you saw yesterday,’’ said Willie Delwiche, investment strategist at Baird. ‘‘You saw stock market weakness, you saw bond yields rising, and you saw the Fed funds futures continuing to shift away from pricing in a rate cut in the near future.’’


The S&P 500 index fell 6.21 points, or 0.2 percent, to 2,917.52. The Dow Jones average dropped 122.35 points, or 0.5 percent, to 26,307.79. The Nasdaq, which is heavily weighted with technology companies, slid 12.87 points, or 0.2 percent, to 8,036.77.

Smaller-company stocks fared better. The Russell 2000 index rose 6.27 points, or 0.4 percent, to 1,582.65.

Major indexes in Europe finished mostly lower.

The S&P 500 index is up 16.4 percent for the year and notched three straight all-time highs before finishing lower Wednesday after the remarks by Federal Reserve chair Jay Powell.

In those remarks, Powell played down the possibility of an interest rate cut this year and restated the central bank’s message that it’s likely there will be no rate hikes in 2019.

Those comments made it seem like investors had a ‘‘less supportive Fed’’ than they anticipated, said Brad McMillan, chief investment officer for Commonwealth Financial Network. He noted that a pullback in stocks was probably because they have been gaining so much over the past few weeks. ‘‘We ran up to new highs again and I think the markets are getting a little bit nervous about that,’’ he said.


The US stock market has been riding high this year as it has made its way back from a nose dive at the end of 2018. The Fed spurred the market’s recovery earlier this year when it signaled it would take a patient approach to raising interest rates.

On Thursday, a slide in crude oil prices helped drag down energy stocks. The sector fell 1.7 percent, more than triple the declines in the technology and communications sectors.

Benchmark US crude fell 2.8 percent to settle at $61.81 per barrel. Brent crude, the international standard, dropped 2 percent to $70.75.

Marathon Oil fell 6.1 percent after the company reported revenue that fell short of estimates.

Technology stocks, the biggest gainers this year, also weighed on the market. Cognizant Technology Solutions led the sector’s decliners, losing 7.7 percent. Microsoft fell 1.3 percent.

Among media companies, Fox Corp. and Discovery Inc. each fell more than 5 percent.

Investors were treated to a mostly mixed batch of corporate earnings reports Thursday.

Fluor was the biggest loser in the S&P 500. The engineering and construction company plunged 24.1 percent after it reported a huge quarterly loss and issued an earnings forecast that was far below what analysts were expecting.

Sports apparel company Under Armour gained 3.5 percent after it reported first-quarter results that beat Wall Street forecasts. It also raised its profit forecast for the year.


Online games maker Zynga climbed 5.6 percent after raising its revenue forecast for the year.

Earnings reporting season is more than a third of the way through, and the results have been better than investors expected. Analysts had been predicting a slump in profits, but their worst fears have not materialized.

The market seemed to approve of Tesla’s decision to attempt to raise more than $2 billion in a stock-and-debt offering. The electric car maker reported a shrinking balance sheet and falling sales in the first quarter, and CEO Elon Musk had suggested Tesla might need to raise more money. The stock rose 4.3 percent.

Traders also proved hungry for Beyond Meat, which soared in its stock market debut. Shares in the maker of plant-based burgers and sausages zoomed more than twofold above their opening price of $25 each. The company is the latest in a string of high-profile IPOs this year, including Slack, Lyft, and Zoom.

Bond prices fell. The yield on the 10-year Treasury note, which influences mortgages and some other loans, rose to 2.54 percent from 2.51 percent late Wednesday.