Dow up on strong earnings, Nasdaq falls on tech
The Dow industrials gained on Thursday on strong earnings reports from several components, while the Nasdaq fell on weakness in Ericsson and other technology names.
A number of Dow members reported better-than-expected results, with 3M Co
While more than 70 percent of S&P 500 companies have exceeded expectations so far this earnings season, according to Thomson Reuters data, investors are concerned the market has overvalued future prospects in a weak economic environment.
The market has risen so much that earnings would need to gain another 50 percent to make it fairly valued, said Joseph Battipaglia, market strategist at Stifel Nicolaus in Yardley, Pennsylvania. More and more, earnings aren't packing the same punch they used to.
The Dow Jones industrial average <.DJI> gained 47.31 points, or 0.48 percent, to 9,996.89. The Standard & Poor's 500 Index <.SPX> rose 0.23 points, or 0.02 percent, to 1,081.63. The Nasdaq Composite Index <.IXIC> shed 7.70 points, or 0.36 percent, to 2,143.01.
Weighing on tech stocks, mobile phone group LM Ericsson
Nokia Corp
Also pressuring the market was an unexpected increase in weekly jobless claims.
We've built up expectations that we're going to have a robust recovery, but the data isn't substantiating that, Battipaglia said.
Anything less than the idea of a V-shaped recovery, which would mean falling claims, throws cold water on the ongoing rally.
3M and Travelers gained after each raised their full-year outlook, sending 3M up 2.9 percent to $78.55, and Travelers up 5.4 percent to $50.60.
Fellow Dow component Merck & Co Inc
United Parcel Service Inc
Trucking company Ryder System Inc
(Editing by Jeffrey Benkoe)
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