The unimpressive corporate results gave little reason to investors to keep U.S. stocks pushing toward new heights after Chevron revealed quarterly profits falling short of expectations, reports Saqib Iqbal Ahmed for Reuters.
“Earnings have really just been fine,” David Lyon, global investment specialist at J.P. Morgan Private Bank, told Reuters “They haven’t been too hot, nor have there been any concerns or cautionary flags raised. I think ‘fine’ might not be enough in the near-term, and there is a growing concern that while the numbers have been good, the forward guidance have been just okay.”
Additionally, stocks lost a step after the Commerce Department revealed gross domestic product rose at a 1.9% annualized rate last quarter, compared to the prior quarter’s 3.5% expansion, due to the biggest drag from trade in six years and moderate consumer spending, reports Sho Chandra for Bloomberg.
Nevertheless, market sentiment remains supported by president Donald Trump’s potential plans on tax reform and fiscal stimulus, which will help maintain growth in 2017, despite his protectionist stance.
Economists expect U.S. growth to range from 1.7% to 2.9%.
“We’re still reasonably positive on the market,” Graeme Bencke, fund manager at PineBridge Investments, told the Wall Street Journal. “Short-term actions the administration can take should be relatively market-friendly,” Bencke added, pointing to policies such as reducing taxes and regulation.
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