Stocks Wobble as Exxon Sinks Energy Companies; Amazon Leaps

NEW YORK (AP) -
stocks
Traders on the floor of the New York Stock Exchange, Friday. (Reuters/Brendan McDermid)

U.S. stocks are little changed Friday after giving up an early gain. Weak results from Exxon Mobil are weighing on energy companies, while big technology companies and defense contractors also take losses. Amazon is climbing following a strong first quarter, and other retailers are up as well. Asian stocks rose following the landmark summit of the leaders from North and South Korea.

KEEPING SCORE: The S&P 500 index edged up 3 points, or 0.1 percent, to 2,670 as of 11:30 a.m. Eastern time. It rose as much as 10 points earlier before briefly turning lower. The Dow Jones Industrial Average lost 11 points, or 0.1 percent, to 24,311. The Nasdaq composite gained 13 points, or 0.2 percent, to 7,132. The Russell 2000 index of smaller-company stocks lost 3 points, or 0.2 percent, to 1,554. Most of the stocks on the New York Stock Exchange traded higher.

AMAZONIAN EARNINGS: Amazon said its first-quarter profit more than doubled as consumers shopped more online and revenue from its cloud-computing business continued to rise. The results were far stronger than Wall Street had expected, and the stock jumped 5 percent to $1,594.07, adding to Thursday’s 4 percent gain. That put the stock close to all-time highs. Amazon also said it will hike the price of an annual Prime membership in the U.S. from $99 to $119.

Amazon stock peaked in mid-March. It slumped over the following weeks after President Donald Trump repeatedly criticized the company over issues including its contracts with the U.S. Postal Service.

Online travel company Expedia rose 8.2 percent to $115.09 as investors applauded its first-quarter report. Athletic apparel maker Nike added 2 percent to $69.43, and rival and Under Armour rose 6.1 percent to $17.93.

EARNINGS: In spite of climbing oil prices, Exxon Mobil’s results fell short of estimates and its stock dropped 3.4 percent to $78.14. Cable company Charter Communications tumbled 15.2 percent to $252.75 after it said it lost subscribers in the first quarter. Jefferies & Co. analyst Scott Goldman said the company’s residential video and high-speed-data subscriber totals were both weaker than he had expected.

Technology companies fared better. Chipmaker Intel climbed 1.3 percent to $53.77 after it raised its profit and revenue forecasts following a strong first-quarter report. Microsoft rose 1.3 percent to $95.46 after it also surpassed analyst estimates.

ECONOMY: The U.S. economy slowed to a moderate 2.3-percent annual growth rate in the first quarter as consumer spending turned in the weakest performance in nearly five years. Still, that was a better showing than experts had forecast, and analysts expect that consumer spending will pick up later in the year thanks to continued low unemployment and the Republican-backed tax cuts.

Stocks rallied Thursday on a combination of strong results from Facebook and other companies and a weaker reading on business investment from the Commerce Department. That suggested that the economy might be growing at a slightly slower pace and could push the Federal Reserve to raise interest rates more gradually.

The weak economic data over the last two days also paused a big gain in bond yields and interest rates. The yield on the 10-year Treasury note fell to 2.95 percent from 2.98 percent Friday. The yield on the 10-year hit four-year highs recently and peaked at 3.03 percent earlier this week.

KOREA SUMMIT: Kim Jong Un became the first North Korean leader to visit South Korea since the end of the Korean War in 1953. He came for talks with South Korean President Moon Jae-in about the North’s nuclear program. The two sides repeated a previous vow to rid the Korean Peninsula of nuclear weapons but failed to provide any specific new measures or forge a potential breakthrough on the issue.

Seoul’s Kospi was 0.7 percent higher and Tokyo’s Nikkei 225 added 0.7 percent. Hong Kong’s Hang Seng advanced 0.9 percent.

U.K. SLOWDOWN: In Britain, shares got a lift after soft growth data reined in expectations that the Bank of England will raise interest rates again next month. The pound fell and London’s FTSE jumped 1 percent, as a weaker currency is good news for British exporters. The German DAX rose 0.5 percent and France’s CAC 40 added 0.4 percent.

ENERGY: Benchmark U.S. crude fell 0.2 percent to $68.07 a barrel in New York, while Brent crude, used to price international oils, rose 0.1 percent to $73.94 per barrel in London.

CURRENCIES: The dollar slipped to 109.03 yen from 109.36 yen. The euro fell to $1.2112 from $1.2106, and the pound fell to $1.3783 from $1.3924.