(Reuters) – Wall Street edged lower on Friday, set to end a strong week on a downbeat note, as heavyweight Johnson & Johnson slipped and worries over global economic growth were rekindled by gloomy data out of China.
Traders work on the floor at the New York Stock Exchange (NYSE) in New York, U.S., October 18, 2019. REUTERS/Brendan McDermid
The world’s second-largest economy expanded at its weakest pace in almost 30 years in the third quarter amid a bitter trade war with the United States, which has roiled financial markets and fueled fears of a global recession.
“China data just adds to the continued slowing global growth concept that has been out there for a while,” said Chris O’Keefe, managing director at Logan Capital Management in Ardmore, Pennsylvania.
The healthcare conglomerate said it would recall a single lot of its baby powder in the United States after the Food and Drug Administration found trace amounts of asbestos in samples taken from a bottle purchased online.
Limiting losses was a raft of robust earnings. Coca-Cola Co (KO.N) shares gained 2.7% after the beverage maker beat analysts’ expectations for quarterly sales, while Schlumberger (SLB.N) rose as profit beat estimates.
“Coke is being innovative and Pepsi also had stronger-than-expected earnings. Overall, these companies are benefiting from the strength of the consumer,” O’Keefe added.
The consumer staples sector .SPLRCS rose 0.5%, while energy stocks .SPNY gained 0.1%.
American Express Co (AXP.N) posted quarterly profit above expectations and reaffirmed its 2019 earnings forecast, but shares of the credit card issuer slipped 0.7%.
The Dow Jones Industrial Average .DJI was down 74.85 points, or 0.28%, at 26,951.03, while the S&P 500 .SPX was down 4.45 points, or 0.15%, at 2,993.50. The Nasdaq Composite .IXIC was down 40.40 points, or 0.50%, at 8,116.46.
The upbeat start to the earnings season has put the S&P 500 and Dow indexes on track for their second straight week of gains, while the Nasdaq .IXIC was set to rise for the third week in a row.
Of the 73 S&P 500 companies to report results so far, 83.6% have topped earnings expectations.
Analysts still expect third-quarter S&P 500 earnings to have fallen by 3.1%, according to Refinitiv data, the first contraction since mid-2016.
Macy’s (M.N), Gap Inc (GPS.N) and L Brands (LB.N) led losses among S&P 500 companies, with declines ranging between 5% and 8% after Credit Suisse downgraded their shares and said weak third-quarter retail trends could continue into fall and holiday season.
Declining issues outnumbered advancers for a 1.01-to-1 ratio on the NYSE and for a 1.33-to-1 ratio on the Nasdaq.
The S&P index recorded 20 new 52-week highs and one new low, while the Nasdaq recorded 40 new highs and 32 new lows.
Reporting by Shreyashi Sanyal and Medha Singh in Bengaluru; Editing by Sriraj Kalluvila