It was a challenging day in the market. Stocks fell on Thursday, after company announcements and earnings releases weighed on a variety of sectors. The S&P 500 (^GSPC 1.09%) dropped 4 points, or 0.17%, while the Dow Jones Industrial Average (^DJI 0.30%) was off by 32 points, or 0.14%.
|
Index |
Point Change |
Percentage Change |
|---|---|---|
|
S&P 500 |
(4.31) |
(0.17%) |
|
Dow Jones Industrial Average |
(31.88) |
(0.14%) |
Data source: Yahoo! Finance.
In terms of individual stocks, the most notable moves came in two sectors. A disappointing update from AT&T (T 1.12%) caused stocks in the telecom industry to suffer, while lackluster earnings from JPMorgan Chase (JPM 0.10%) and Citigroup (C 0.50%) did the same to bank stocks.
AT&T loses video subscribers
AT&T isn't scheduled to report earnings until Oct. 24, two weeks from now, but it gave investors an early glance of what to expect. Given that AT&T's stock proceeded to drop by 6%, one of the worst performers on the S&P 500 today, it's clear that investors didn't like what they saw.
In a filing submitted to the Securities and Exchange Commission, AT&T said it lost 90,000 U.S. video subscribers.
"The video net losses were driven by heightened competition in traditional pay-TV markets and over-the-top services, hurricanes, and our stricter credit standards," the company explained. "The decline of traditional video subscribers negatively impacts our entertainment group revenues and margins, resulting in an adjusted consolidated operating income margin that will be essentially flat versus the year-ago third quarter."
One AT&T Plaza in Dallas. Image source: AT&T.
On top of that, the company reported that the recent hurricanes "significantly impacted certain regions of our service area during the third quarter." As a result of damage to its network and other property, as well as a variety of other related issues, will translate into a $90 million drop in revenue and a $210 million decline in pre-tax earnings.
In the wake of the news, companies across the entertainment and telecom industries saw their shares come under pressure, including Comcast, Time Warner, Disney, and others.
Citigroup and JPMorgan Chase report earnings
The other leading story in the market today involved bank earnings. JPMorgan Chase and Citigroup were the first of the nation's big banks to report third-quarter results.
Profit at JPMorgan Chase climbed in the third quarter by 7% over the year-ago period. The nation's biggest bank by assets earned $6.7 billion, or $1.76 per share, for the three months ended Sept. 30. The per-share figure handily outperformed predictions, with analysts expecting it to earn $1.65 per share.
Image source: Getty Images.
Citigroup similarly beat expectations. It reported net income of $4.1 billion for the quarter, or $1.42 per share, up 8% from the third quarter of last year. Analysts had expected the nation's fourth biggest bank by assets to earn $1.32 per share.
Shares of both banks nevertheless declined, with Citigroup leading the way, finishing down by 3.4%. JPMorgan Chase's stock was off by 0.93%. The culprit was concern about credit quality, with both banks setting aside more money for to cover bad loans than they did 12 months ago.
In short, while the banks claim that the increase is nothing to worry about, investors appeared to come to a different conclusion.
