US Stocks Are Mixed; Crude Spikes as Rig Count Drops
New York (Oct 16) Stocks were mixed by mid-afternoon Friday in a quieter end to the week as Honeywell (HON - Get Report) weighed on the industrial and basic materials sectors.
The S&P 500 was up 0.09%, the Dow Jones Industrial Average added 0.05%, and the Nasdaq slid 0.1%.
Crude oil spiked after the number of active oil rigs in the U.S. dropped by 10 to 595 over the past week, according to Baker Hughes. Commodity traders have been eager to see signs a supply-demand imbalance is being corrected. West Texas Intermediate added 1.8% to $47.20 a barrel.
Honeywell reported a mixed quarter, though profit jumped 8.3% on lower costs. The manufacturer of aerospace materials earned $1.60 a share, up from $1.47 a year earlier, and beat estimates by a nickel. Revenue slid 5% to $9.61 billion. Shares fell nearly 3%.
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Alcoa (AA - Get Report) , Monsanto (MON - Get Report) , Freeport-McMoRan (FCX - Get Report) and Rio Tino (RIO) were among the worst performers in the materials sector, while the Materials Select Sector SPDR ETF (XLB) fell 0.5%. Among the industrials, Kansas City Southern (KSU) , W.W. Grainger (GWW) and Caterpillar (CAT) fell, and the Industrial Select Sector SPDR ETF (XLI) slid 0.8%.
However, General Electric (GE) climbed after besting quarterly earnings expectations as performance in its jet engines business helped to offset declines in oil and gas. The industrials company earned 29 cents a share in the third quarter, 3 cents above estimates. However, revenue fell more than 1% from a year earlier to $31.7 billion. Shares added nearly 2%.
Industrial production declined 0.2% in September, the Federal Reserve said Friday. The reading was as economists had expected. August was revised to a 0.1% drop from a previous 0.4% decline. Capacity utilization dropped to 77.5% from 77.8% in August.
United Continental (UAL) tumbled more than 3% on news CEO Oscar Munoz had been hospitalized following a heart attack on Thursday. The airline said it plans to continue to operate normally. Munoz was named United CEO last month after acting as chief operating officer of CSX (CSX) .
Video-streaming site Youku Tudou (YOKU) surged more than 20% after Alibaba (BABA) offered to buy out the rest of the company it doesn't already own. The Chinese e-commerce site offered $26.60 for each American Depositary share, a 30% premium to Thursday's close. The move marks the latest sign Alibaba is looking to diversify outside of its core e-commerce business.
Schlumberger (SLB) shares were on watch after the oil company earned 78 cents a share in its third quarter, a sharp drop from $1.49 a year earlier. Revenue slumped 33% to $8.5 billion and was down 6% from a quarter earlier. Schlumberger also said it expects "challenging" conditions in coming quarters.
Yum! Brands (YUM) has added activist investor Keith Meister to its board. The disciple of billionaire activist investor Carl Icahn is founder of Corvex Management, a firm that holds nearly 5% of Yum! Brands stock.
Wynn Resorts (WYNN) slumped 8% following a disappointing third quarter. The casino operator reported a 27% drop in revenue, driven by weaker sales in key gambling destination Macau. Earnings of 86 cents a share missed by 2 cents.
Consumer sentiment climbed to 92.1 in October, according to the University of Michigan, much higher than the final reading of 85.7 in September. Consumers appeared to have recovered from fears over the global economy and market instability. Economists had expected the measure to rise to 89.