Fed, Earnings Cast Pall Over US Stocks

Wall Street stocks finished the week on a downbeat note, falling after news of a tanker attack in the Middle East even as Boeing and oil-linked shares rallied.

Stocks had been in positive territory through early afternoon, but fell decisively as Iran's Revolutionary Guards announced they had confiscated a British tanker in the strategic Strait of Hormuz -- a move that prompted swift criticism from the United States and Britain.

The fall also roughly coincided with a Wall Street Journal report that the Federal Reserve is targeting a 25-basis point interest rate cut, rather than the larger 50-basis point cut that investors have thought might also be enacted.

The Dow Jones Industrial Average finished 0.3 percent lower at 27,154.

The S&P 500 shed 0.6 percent to 2,976, while the Nasdaq Composite Index dropped 0.7 percent to 8,146.

The losses closed out a down week following the first group of major earnings reports with two more big weeks yet to come.

Companies have generally exceeded modest expectations but some have expressed caution due to doubts about growth and US trade conflicts.

"The earnings season so far has been pretty much as expected, which is less than great," said Maris Ogg of Tower Bridge Advisors, adding that the outlook was not "terribly good."

Microsoft climbed 0.2 percent after its report, while American Express dropped 2.8 percent.

Large technology shares were generally under pressure, with Apple, Google parent Alphabet and Facebook all losing more than one percent.

But oil-linked shares bounced along with oil prices, with Apache winning 3.1 percent and Marathon Oil 2.1 percent.

Boeing had a big day, surging 4.5 percent despite announcing some US$6.6 billion in new costs tied to the grounding of the 737 MAX planes.

Analysts said investors were encouraged that Boeing is still targeting the fourth quarter of 2019 as a return date for the MAX instead of early 2020 as had been feared.

Also, Boeing did not further cut its production level of 737 MAX aircraft, another worry investors had had ahead of the report. (AP)