The major averages were mixed following another deluge of earnings reports, highlighted by better than expected results from two of the biggest names in tech and a disappointing report from Dow member 3M (MMM). Investors will have another set of reports to analyze tonight and tomorrow morning, with results upcoming from Amazon (AMZN), Intel (INTC), Starbucks (SBUX), Ford Motor (F), Exxon Mobil (XOM), Chevron (CVX) and a slew of others.
ECONOMIC EVENTS: In the U.S., advance durable orders rebounded 2.7% in March, which was stronger than expected. Initial jobless claims rose 37,000 to 230,000 in the week ended April 20.
TOP NEWS: Microsoft (MSFT) spent part of the session with a market capitalization over $1T as its Q3 earnings report fueled an advance in the stock. Shares of the tech giant finished just below that round number in market cap, finishing up 3.3% on the day at $129.15.
Joining its mega-cap tech partner in a post-earnings rally, Facebook (FB) rose 5.85% after it reported better than expected revenue, free cash flow, EPS and active user metrics. Of note, Facebook also estimated a probable loss and recorded an accrual of $3B in connection with the inquiry of the FTC into its platform and user data practices, stating that it sees that the range of loss in this matter as $3B-$5B.
Meanwhile, 3M shares dropped just over 13% after it reported worse than expected first quarter sales and profits, lowered its full-year earnings view and announced plans to cut 2,000 positions worldwide to reflect "a slower than expected 2019." Also sliding after earnings is UPS (UPS), which was 8.1% lower after the shipper posted worse than expected profit and revenue but backed its full-year earnings forecast. Additionally, Tesla (TSLA) slipped 4.3% after reporting downbeat results for the first quarter. The car maker, however, said that it expects to "significantly" reduce its loss in the second quarter and return to profitability in the third quarter.
In M&A news, Deutsche Bank (DB) announced that its Management Board has concluded that a combination with Commerzbank (CRZBY) "would not have created sufficient benefits to offset the additional execution risks, restructuring costs and capital requirements" and the two banks have decided to discontinue talks about a merger. Meanwhile, the UK Competition and Markets Authority prohibited the proposed merger of Asda and Sainsbury's (JSAIY). Afterward, Bloomberg reported that Walmart (WMT) is reviewing options for its Asda unit, including an IPO, after plans to merge the division with Sainsbury's fell through.
In other deal news, the Wall Street Journal reported that Avaya (AVYA) is in talks to combine with rival Mitel Networks in a stock deal worth over $2B.
MAJOR MOVERS: Among the noteworthy gainers was Fortune Brands (FBHS), which rose 4.3% after reporting better than expected quarterly results and reaffirming its fiscal 2019 guidance. Also higher after reporting quarterly results were ServiceNow (NOW) and PayPal (PYPL), which gained a respective 7.4% and 2.8%.
Among the notable losers was Martin Midstream Partners (MMLP), which slid 21.3% after reporting downbeat quarterly results and cutting its dividend to 25c per share from 50c. Also lower after reporting quarterly results were Consolidated Communications (CNSL) and Chipotle (CMG), which fell 34.2% and 4.5%, respectively.
INDEXES: The Dow fell 134.97, or 0.51%, to 26,462.08, the Nasdaq gained 16.67, or 0.21%, to 8,118.68, and the S&P 500 declined 1.08, or 0.04%, to 2,926.17.