Gold was the big winner Wednesday as stocks pared back to moderate losses and Walt Disney (DIS) dragged on the Dow, while Netflix (NFLX) and Priceline Group (PCLN) hindered the Nasdaq and retailers took some brutal hits after reporting second-quarter results.
XAutoplay: On | Off Gold climbed as traders exited stocks and fled to more secure ground, as the back-and-forth saber-rattling between the U.S. and North Korea escalated. News late Tuesday that North Korea was reviewing plans for an attack on U.S. military assets on the island of Guam came just hours after President Trump had warned that continued threats would be met “with fire and fury like the world has never seen.”
First, a wave of selling doused Asia’s markets — sending Tokyo’s Nikkei 225 down 1.3% and pressuring South Korea’s Kospi Index to a 1.1% decline. The mood then hit Europe, where Frankfurt’s DAX dropped 1.1% and the CAC-40 in Paris fell 1.4%.
U.S. stocks felt significant early drag, with the S&P 500 down 0.5% at the open. The Dow also fell 0.5% to dip briefly back below the 22,000 mark, and the Nasdaq tumbled nearly 1%. But the Nasdaq stopped short of a test of its 50-day moving average, and pared its loss for the day to 0.3%.
The Dow ended down 0.2% and the S&P 500 narrowed to a fractional loss. Preliminary data showed volume was mixed, higher on the Nasdaq, lower on the NYSE. Gold settled up 1.4% at $1,256.40 an ounce, then rose nearly 2% — to nearly $1,283 — after Wednesday’s settlement.
Disney, Netflix To End Arrangement; Hertz Sails
Politics set an overcast tone for the session, but the detailed action of stocks narrowing and in many instances reversing early losses resulted from earnings reports.
Disney was the Dow’s anchor, falling 5% after a mixed second-quarter report. The stock sliced below its 10-week moving average in massive trade, triggering a sell signal and ending a four-month basing effort.
Disney also announced that it was ending its film distribution deal with Netflix, in order to launch a streaming film-delivery service of its own. Netflix shares dropped 5% at the start of trade, but trimmed the decline to less than 2% by the close. That left the stock a bit more than 5% above a 166.97 buy point in a flat base.
On the crazy upside, Hertz Global Holding (HTZ) posted an inexplicable 24% gain after revenue fell in line with consensus views but earnings fell much further.
Weibo (WB) and Sina (SINA) staged powerful reversals after earnings reports triggered sharp early losses. Weibo made back its losses to close up 1% and extended above a 79.08 buy point in a cup-with-handle base. Sina recovered to end almost flat, and still in a buy range above a 97.89 flat-base buy point.
Priceline Group took a trip, down 7% after reporting a strong beat with its second-quarter results, but lowering its third-quarter earnings guidance to below the consensus number. The move drove Priceline shares below their 10-week moving average in very heavy trade, triggering a sell signal.
TripAdvisor (TRIP) scored one of the day’s most impressive reversals, turning an early 10% dive into a 3% gain at the close. The provider of travel information dove after beating second-quarter earnings and revenue expectations, but giving third-quarter guidance below consensus forecasts. The stock ended 15% above a late-June low, as it battles to start up the right side after a three-year decline.