US Stocks Sell Off On Weak Earnings Expectations

Wall Street retreated on Friday, heading into the weekend with a broad sell-off due to weak earnings, surging coronavirus cases and geopolitical uncertainties.

For the second day in a row, the tech sector weighed heaviest on all three major US stock averages. Intel Corp led the decline, its shares plunging 16.2 percent after the chipmaker reported a delay in production of a smaller, faster 7-nonometer chip.

"There's a skittishness ahead of the weekend after yesterday's tech and growth sell-off," said Ryan Detrick, senior market strategist at LPL Financial in Charlotte, North Carolina.

"It's been an unbelievable ride for the Nasdaq and tech over the last two months," Detrick added. "A well-deserved correction makes a lot of sense in our view."

Each index posted a weekly loss, with the S&P 500 and the Dow snapping three-week winning streaks. Nasdaq had its weakest week of the last four.

The retreat followed a rally that brought the S&P 500 to nearly 5 percent below its record high reached in February. The bellwether index is now near break-even for the year, while the Nasdaq has gained more than 15 percent year-to-date.

"With the rally we've seen so far in July, it makes sense to see anxiety ahead of a huge earnings week, the Fed decision and what's likely to be the worst GDP in our lifetimes," Detrick added.

Momentum stocks Apple, Alphabet Inc and Amazon.com are scheduled to post results on July 30, the day the US Commerce Department is due to give its first take on second-quarter GDP. Analysts project that the economy dropped by a bruising 35 percent during the three-month period.

More than 1,000 Americans died from Covid-19 on Thursday, the third straight day for that grim milestone as total cases surged past 4 million.

Beijing fired back at Washington shuttering China's Houston consulate by closing the US consulate in the city of Chengdu.

The Dow Jones Industrial Average fell 0.68 percent to 26,469.89, the S&P 500 fell 0.62 percent to 3,215.63 and the Nasdaq Composite dropped 0.94 percent to 10,363.18. (Reuters)