Patrick Casey, right, works with fellow traders on the floor of the New York Stock Exchange, Tuesday, April 2, 2019. Stocks are opening lower on Wall Street as the market pulls back following a three-day rally. (AP Photo/Richard Drew)
U.S. stocks edged lower in afternoon trading Tuesday as the market gave back some of its gains from a three-day winning streak.
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Consumer products, energy and industrial companies accounted for much of the slide.
Health care companies also declined. Walgreens Boots Alliance plunged after it slashed its forecast following a weak quarter. Competitor CVS followed it lower.
Communications and technology sector stocks bucked the downward trend. Facebook rose 3% and Western Digital gained 2.9%.
Dow Inc., which makes plastics and other products for both consumer and industrial uses, climbed 4.4% in its first day of trading after being spun off from chemical maker DowDuPont.
The modest slide in stocks marks a reversal from an overall strong stretch for the market. The benchmark S&P 500 finished the January-March period with its biggest quarterly gain in nearly a decade. The index is now up 14.4% this year, and would now need to rise just 2.3% to regain the peak it reached September 20.
Traders are gearing up for a slew of corporate earnings this month, as the next big wave of company results kick into gear next week.
Wall Street expects a contraction in earnings during the first quarter, followed by slow growth for the remainder of 2019. Any company commentary about their prospects for the next few quarters will be important in giving analysts and investors a better picture of the economy.
Investors also have their eye on the U.S.-Chinese trade negotiations, which are due to resume this week. Officials from the world’s two biggest economies are aiming to put to rest a dispute over technology and other issues.
ANALYST’S TAKE: Investors are still not sure which direction to move as they weigh uncertainty over international trade issues and warnings over a weak first quarter for companies.
The unresolved trade dispute between the U.S. and China is still a key issue, said J.J. Kinahan, chief market strategist at TD Ameritrade.
“Nobody wants to buy with both hands, just in case,” he said. “But, people won’t aggressively sell everything as well, just in case.”
KEEPING SCORE: The Dow Jones Industrial Average fell 101 points, or 0.4% as of 2 p.m. Eastern Time. The S&P 500 index dropped 0.1% and the Nasdaq composite index rose 0.2%. The Russell 2000 index of smaller company stocks gave up 0.3%.
Major European stock indexes headed higher.
TAKE AN ASPIRIN: Walgreens had a headache of a quarter as insurers trimmed prescription costs, generic drug prices dropped and brand-name medication prices stalled.
Al those factors resulted in a 14% drop in second-quarter profit, which the company’s CEO described as the most difficult quarter the nation’s largest drugstore has faced since forming a few years ago.
Walgreens also slashed its forecast for 2019.
The stock fell 12.4% and helped push down key competitor CVS Health by 3.1%.
LIFTOFF: Delta climbed 7.1% after raising its profit forecast for the current quarter, citing strong passenger demand. The company also said fuel costs were less than expected and it extended a credit card partnership with American Express.
Other airlines also rose. United Continental rose 3% and American Airlines Group added 2.6%, and JetBlue Airways rose 1.7%.
LOADED POTATO: Lamb Weston Holdings rose 0.3% after the potato products company beat quarterly profit and revenue forecasts. It also raised its full-year sales forecast. The company specializes in frozen potato products, including french fries, mashed potatoes and hash browns.
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