Stocks dropped hard at Thursday's open, as undertow from global markets, company news and mixed early earnings reports took a toll.
X The Nasdaq led the drop, down 0.6%, with the Dow Jones industrial average and S&P 500 each falling 0.3%.
A sell-off in Hong Kong left the Hang Seng index down 1.9% as a sudden rise in short-term lending costs sent property developers sharply lower. The index has gained more than 30% since the start of the year.
Hong Kong's stumble rippled into Europe's markets, which came under additional pressure after Spain's government formally suspended the autonomy of Catalonia. The region's parliament had elected to secede in what the Spanish government considered an illegal vote. The federal government reportedly plans to begin taking over control of the region Saturday.
Spain's leading index, the IBEX 35, traded down 0.9%. Frankfurt's DAX and the CAC-40 in Paris fell hardest among Europe's larger benchmarks, down 0.6% apiece in afternoon trade.
Verizon, Adobe Spikes, Apple Falls, Winnebago Slips
Verizon (VZ) surged to top top of the Dow, up almost 5% as third-quarter earnings fell less, and revenue rose more, than expected by analysts. Wireless subscriber growth was the big surprise, with 603,00 new subscribers vs. estimates for an increase of 362,000.
The move lifted Verizon shares past a 50.41 buy point.
Travelers (TRV) dropped 0.4%, despite after reporting third-quarter revenue and earnings well above analysts' targets. Investors had watched the report closely following for the impact of hurricanes in Texas and Florida.
Early Thursday, Travelers rose above a 130.47 buy point in a cup base but reversed below the entry.
At the bottom of the Dow, Apple (AAPL) dived 1.8% after news reports that the one company providing cellular service to Apple Watch products in China cut its service without explanation. Apple shares have been fighting to hold above support at their 10-week moving average.
Nike (NKE) dropped 0.5% after Goldman Sachs downgraded the stock to neutral from buy. Goldman cited high levels of inventory at brick-and-mortar retailers, and pressure from promotional pricing as Nike products move to direct online sales via Amazon.com (AMZN) and others.
EBay (EBAY) slumped 4%, after reporting late Wednesday that its third-quarter results met expectations, but its fourth-quarter earnings guidance stopped short of consensus views.
Shares have pulled back in a test of support at their 10-week moving average, just above a 37.58 buy point in a cup base.
Tobacco brand Philip Morris (PM) dipped 4% in early action. The Marlboro maker missed analysts' third-quarter targets on its earnings and revenue lines, and guided fourth-quarter expectations below consensus views. Shares have been declining since June.
IBD 50 stock Winnebago (WGO) dropped 2%, depite better-than-expected fiscal fourth-quarter results and a new a $70 million share buyback program. The stock ended Wednesday up 19% from a 37.30 buy point. Investors who bought during that September breakout should consider locking in some profit once gains hit 20%.
Adobe Systems (ADBE) opened 9% higher as the stock received an upgrade after the software and cloud leader released positive fourth-quarter guidance late Wednesday. Adobe shares closed Wednesday 3% below a 157.99 buy point in a flat base.
Unemployment Claims Dip, Philly Fed Index Jumps
Unemployment claims declined for a third straight week, to 222,000 in the week ended Oct. 14, the Labor Department said. That was down from 244,000 claims in the prior week, and well below consensus expectations for a decrease to 240,000.
The four-week moving average dropped to 248,500, also a third straight decline and its lowest level of the third quarter.
Mid-Atlantic region manufacturing activity powered up in October, sending the Philadelphia Federal Reserve's Manufacturing Business Outlook Survey to 27.9 for the month, up from 23.8 in September and clobbering estimates calling for a decline to 20.2.
New orders and shipments decreased for the month, but remained positive, the report said. Employment rose and the length of workweeks increased, delivery times increased and backlogs rose.
The Conference Board releases its Leading Indicators index for September at 10 a.m. ET. Release of the September Treasury budget was pushed back for a second day, to 2 p.m. ET.
Esther George, president of the Kansas City Federal Reserve, is scheduled to speak on rural and urban growth issues in Altus, Okla., at 9:30 a.m. ET.
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