U.S. stocks fell for the second straight session on Thursday. The market manifested investors' concerns over a potential government shutdown, as well as the Federal Reserve's decision on Wednesday to hike interest rates for the fourth time in 2018.
With downward momentum accelerating as the day wore on, the Dow Jones Industrial Average (^DJI -0.11%) lost another 2% to close at a fresh 14-month low, while the S&P 500 (^GSPC 0.02%) posted a 1.6% decline.
Today's stock market
| Index | Percentage Change | Point Change |
|---|---|---|
| Dow | (1.99%) | (464.06) |
| S&P 500 | (1.58%) | (39.54) |
Data source: Yahoo! Finance.
Oil stocks fell the hardest amid continued worries over a supply glut and slowing global growth, leaving the SPDR S&P Oil & Gas Exploration & Production ETF (XOP 0.47%) down 3.8%. Tech stocks weren't far behind, with the Technology Select Sector SPDR ETF (XLK 0.46%) around 1.8% lower.
As for individual stocks, earnings news sent shares of Walgreens Boots Alliance (WBA -1.33%) south, while a short-seller's attack left Twitter (TWTR) reeling.
Image source: Getty Images.
Walgreens is cutting costs
Walgreens stock dropped 5% after the retail pharmacy giant announced strong fiscal first-quarter 2019 results, but also reiterated its full-year guidance and unveiled an ambitious multiyear cost-reduction initiative.
Quarterly sales climbed 9.9% to $33.79 billion. That translated into a 7% jump in adjusted (non-GAAP) net income to $1.4 billion, and a 14.1% increase in adjusted earnings per share to $1.46. Analysts, on average, were modeling slightly lower earnings of $1.43 per share on roughly the same revenue.
Executive Vice Chairman and CEO Stefano Pessina said he was "pleased" with the company's growth, singling out a "solid" performance in the United States.
But Pessina also revealed Walgreens is launching a new "transformational cost management program" with a goal of reducing annual costs by over $1 billion by the end of its third year -- a move he says the company's making to "better position ourselves to meet our long term targets."
Wall Street viewed that verbiage as a sign of caution for what lies ahead, particularly as newer market entrants like Amazon's PillPack threaten to muscle into its niche.
Is Twitter bad for advertisers?
Shares of Twitter fell 11.1% after Citron Research issued a new report calling the platform "the Harvey Weinstein of Social Media."
Citing a study by Amnesty International that said Twitter was "a toxic place for women," Citron's Andrew Left predicts the "culture of hate and anonymity" on Twitter will eventually force the company to tweak its business model to better monitor this kind of activity. If it does, he argues it could have a significant negative effect on user growth. But if it doesn't, Twitter risks becoming equally "toxic" to investors and advertisers.
By his math, Left believes Twitter should be worth closer to $20 per share, or a nearly 40% discount from yesterday's closing price.
To be clear, as a notorious short-seller that profits from these declines -- and as one known for its often sensationalized work -- investors would do well to take these claims with a grain of salt. Nonetheless, it's no surprise to see Twitter stock fall in their wake.
