Investing.com – The Dow slipped Friday, led by Intel and IBM and weakness in energy stocks as a surprise increase in U.S. weekly crude inventories pressured oil prices.
Intel (NASDAQ:INTC) fell 9% after reporting fiscal first-quarter results that topped consensus estimates, but the results were driven by a strong gains in its lower-margin PC-centric business. Wall Street analysts, meanwhile, were also cautious on the stock as they await a further update on Intel’s long-term manufacturing plan.
“We think DC [data-centric] and share loss will likely occur in 2021E until a long-term manufacturing plan is in place,” RBC said as it upgraded its price target on intel to $47 from $40.
International Business Machines (NYSE:IBM) posted its fourth straight quarter of revenue declines amid underperformance in its cloud business, sending its shares down more than 9%
“[IBM’s] results continue to reflect an ongoing cannibalization phase of its legacy software/services revenue base (roughly 70% of mix), and potential share losses offset by a relatively underperforming (but growing) digital/cloud business,” Wedbush said in a note.
Energy was among the biggest decliners, paced by a decline in oil prices after data showing an unexpected build in weekly inventories stoked worries the underlying improvement in the supply-demand imbalance will come unstuck.
Crude inventories rose 4.35 million barrels, against expectations for a draw of 1.16 million barrels, the Energy Information Administration said Friday.
Airlines stocks continued to trend lower on expectations for tighter restrictions in Europe. France said it would be require Covid-19 tests on entry into the country from Sunday.
There was also some concern on the pandemic front after reports of fresh lockdowns in China as a rise in infections dented optimism on the global economic recovery.
In the U.S., meanwhile, further help is on the way.
President Joe Biden is expected to sign executive orders on Friday focused on delivering boosting food stamps and stimulus checks to low-income Americans, and on raising the minimum wage to $15 for the federal workforce.
Airlines continued to trend lower expectations for the tighter restrictions in the Europe.
In other news, GameStop (NYSE:GME) surged 40% as investors continued buy up the stock in the wake of short squeeze.