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What Happened in the Stock Market Today

By Demitri Kalogeropoulos - Apr 28, 2017 at 4:39PM

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Alphabet and Starbucks stocks stood out as indexes declined.

Stocks fell on Friday, with both the Dow Jones Industrial Average (^DJI -0.20%) and the S&P 500 (^GSPC -0.30%) indexes finishing lower by less than 0.25%.

Today's stock market


Percentage Change

Point Change




S&P 500



Data source: Yahoo! Finance.

Financial stocks saw some of the heaviest trading volumes, and the Financial Select Sector SPDR ETF (XLF -0.34%) fell behind the broader market with a 1% drop. A small uptick in gold prices, meanwhile, helped push the the volatile Direxion Daily Junior Gold Miners Bull 3X ETF (JNUG -2.07%) up 3%.

As for individual stocks, Alphabet (GOOGL -1.81%) (GOOG -1.62%) and Starbucks (SBUX -0.55%) attracted heavy investor interest following their respective quarterly earnings reports.

Outside the stock exchange in New York.

Image source: Getty Images.

Alphabet posts broad growth

Shares of Google parent Alphabet jumped almost 4% after the search giant announced surprisingly strong earnings. Sales jumped 22% to $24.75 billion and outpaced consensus estimates that were targeting $24.2 billion. Profits blew past expectations as earnings soared 28% to $7.73 per share. Wall Street would have been happy with $7.40 per share of profit.

The Google business continues to shine, with operating income up 22% to $7.6 billion on surging advertising revenue. The segment benefited from stellar results in a young hardware segment that now includes the Google Home speaker and the Pixel smartphone. These newer revenue streams joined the booming growth in established areas like mobile search and YouTube to send overall operating margin up a full percentage point to 27% of sales.

The company's Other Bets unit expanded its loss to $855 million from $774 million while boosting revenue by nearly 50% to $244 million.

Executives were happy with the operating trends and telegraphed more aggressive spending on improving its search platform while pushing deeper into the hardware business. "Our excellent results represent a terrific start to 2017," Chief Financial Officer Ruth Porat said in a press release. "We clearly continue to benefit from our ongoing investments in product innovation and have great momentum in our new businesses across Alphabet," Porat continued.

Starbucks sees an end to its traffic struggles

Starbucks shares dipped 2% despite the coffee titan posting record fiscal second-quarter sales and earnings figures. Revenue rose 6% as a 3% boost in comparable-store sales combined with a quickly growing store base. The company also managed an uptick in profitability, with operating margin rising to 17.7% of sales from 17.3%. As a result, earnings rose at a healthy 15% clip to $0.45 per share.

But Starbucks wasn't immune to the broader retailing slowdown that's hurting peers across the industry. Customer traffic was flat in the key U.S. market during what new CEO Kevin Johnson described as "a very difficult period for many brick-and-mortar retailers."

A coffee cup surrounded by coffee beans.

Image source: Getty Images.

On the bright side, Starbucks said operating trends in the U.S improved throughout the quarter. Additionally, the company is "seeing further acceleration into April," Chief Financial Officer Scott Maw explained in a press release.

Those recent trends are giving executives confidence that growth will speed up over the next two quarters to allow the beverage giant to meet its long-term annual growth goals despite industry challenges. Starbucks aims to boost sales by 10% annually as earnings rise by 15% to 20%, but through the first half of fiscal 2017, revenue is up just 6% and profit is running 14% higher.

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Stocks Mentioned

Alphabet Inc. Stock Quote
Alphabet Inc.
$2,316.67 (-1.81%) $-42.83
Starbucks Corporation Stock Quote
Starbucks Corporation
$77.68 (-0.55%) $0.43
Alphabet Inc. Stock Quote
Alphabet Inc.
$2,332.45 (-1.62%) $-38.31
Dow Jones Industrial Average (Price Return) Stock Quote
Dow Jones Industrial Average (Price Return)
$31,438.26 (-0.20%) $-62.42
S&P 500 Index - Price Return (USD) Stock Quote
S&P 500 Index - Price Return (USD)
$3,900.11 (-0.30%) $-11.63
The Select Sector SPDR Trust - The Financial Select Sector SPDR Fund Stock Quote
The Select Sector SPDR Trust - The Financial Select Sector SPDR Fund
$32.23 (-0.34%) $0.11
Direxion Shares ETF Trust - Direxion Daily Junior Gold Miners Index Bull 3X Shares Stock Quote
Direxion Shares ETF Trust - Direxion Daily Junior Gold Miners Index Bull 3X Shares
$40.66 (-2.07%) $0.86

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

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