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US STOCKS-Tech, energy stocks weigh on Wall Street
May 4, 2017 / 3:40 PM / 7 months ago

US STOCKS-Tech, energy stocks weigh on Wall Street

* Oil falls 2.6 pct to lowest since late November

* Facebook falls on worries over future growth

* Traders hike June rate hike odds after Fed statement

* Tesla drops after reporting bigger-than-expected loss

* Indexes down: 0.16 pct, S&P 0.02 pct, Nasdaq 0.07 pct (Adds details, changes comment, updates prices)

By Tanya Agrawal

May 4 (Reuters) - U.S. stocks were little changed on Thursday as a decline in energy and technology stocks erased some of the early gains following the Federal Reserve’s upbeat comments about the economy.

Energy stocks were dragged lower as crude oil prices dropped more than 2.6 percent to their lowest since late November on concerns over rising global supply.

The energy sector fell 1.48 percent, leading the losers among the 11 major S&P 500 sectors, with Exxon, Chevron and Occidental Petroleum weighing the most.

Chesapeake Energy fell 7.4 percent after reporting a bigger-than-expected fall in production.

The technology sector was influenced by declines in Apple and Facebook.

Facebook’s 1 percent fall weighed on both the S&P 500 and Nasdaq after the company’s outlook on advertising growth and expenses spooked investors.

Apple was down 0.5 percent, and was the biggest drag on the S&P 500 and the Nasdaq.

At the other end of the spectrum were financials, which gained 0.61 after the Fed’s hawkish tone indicated the central bank could raise interest rates in June.

The Fed downplayed recent weak economic data and emphasized the strength of the labor market. It added that consumer spending continued to be solid, business investment had firmed and inflation has been “running close” to its target.

“I think the Fed’s diagnosis of what happened in the first quarter was basically correct,” said David Donabedian, chief investment officer of CIBC Atlantic Trust Private Wealth Management in Washington.

“The economic data waxes and wanes and there’s clearly a seasonal adjustment in the first quarter from which we see a bounce back.”

Futures traders are now pricing in a 72 percent chance of June rate hike, up from 63 percent before the Fed’s statement on Wednesday, according to the CME Group’s FedWatch Tool.

At 10:58 a.m. ET (1458 GMT), the Dow Jones Industrial Average was down 32.83 points, or 0.16 percent, at 20,925.07.

The S&P 500 was down 0.57 points, or 0.023868 percent, at 2,387.56 and the Nasdaq Composite was down 4.11 points, or 0.07 percent, at 6,068.45.

Caterpillar’s 2.3 percent drop weighed the most on the Dow.

Earnings of S&P 500 companies have generally come in above expectations, pushing the benchmark index to within 1 percent of its all-time high.

First-quarter profits at S&P 500 companies are estimated to have increased 14.2 percent, its strongest growth since 2011, according to Thomson Reuters I/B/E/S.

Tesla was down 4.6 percent to $296.64 after the electric-car maker posted a bigger-than-expected loss.

Viacom fell 4.1 percent to $37.65 on a softening advertisement market and news that Charter Communications has re-tiered five of Viacom’s flagship networks.

Regeneron rose 5.1 percent to $428.03 after the biotech company’s revenue edged past analysts’ estimates.

Declining issues outnumbered advancers on the NYSE by 1,925 to 866. On the Nasdaq, 1,515 issues fell and 1,124 advanced.

The S&P 500 index showed 30 new 52-week highs and nine new lows, while the Nasdaq recorded 72 new highs and 45 new lows. (Reporting by Tanya Agrawal; Editing by Savio D‘Souza)

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