Retailers stumble, but stock indexes barely move

U.S. stock indexes finished Tuesday near where they started. Technology companies and household goods makers rose, but weak reports from sporting goods and auto parts retailers left a lot of smaller companies with steep losses.

Dick’s Sporting Goods and Advance Auto Parts both disclosed disappointing quarterly results and cut their forecasts, which affected a slew of other companies. Other retailers also dropped, including Home Depot, which posted strong results. Other groups of stocks managed modest gains.

“Especially in the month of August, when not as many investors are around, you get a lot of this group trading,” said Brian Nagel, an analyst who covers retailers for Oppenheimer & Co.

Nagel said struggles for Dick’s and Advance Auto Parts don’t say anything about how retailers in other industries are doing, but if investors grow pessimistic about retail, they may sell all kinds of retailers when one part of the industry struggles.

The Standard & Poor’s 500 index fell 1.23 points, or less than 0.1%, to 2,464.61. The Dow Jones industrial average ticked up 5.28 points, or less than 0.1%, to 21,998.99. The Nasdaq composite fell 7.22 points, or 0.1%, to 6,333.01. The Russell 2000 index of smaller-company stocks slid 11.07 points, or 0.8%, to 1,383.24. The S&P 600, an index of small-cap stocks, dropped 1%.

Stocks were coming off their biggest one-day gain in more than three months as the market recovered from last week’s turmoil.

Dick’s Sporting Goods plunged 23% to $26.87 after it cut its annual forecast after a weak second quarter. The sporting goods chain said that athletic apparel sales were weak and that it plans to do more marketing and cut prices as it tries to keep its market share.

Foot Locker fell 4.4% to $47.13. Hibbett Sports dropped 16.5% to $11.65. Athletic apparel companies also lost ground. Nike fell 2% to $58.56. Under Armour declined 2.6% to $16.66.

Advance Auto Parts tumbled 20.3% to $87.08 after it slashed its annual forecasts. The company and its rivals are facing weakening demand because car sales are slowing down from their recent record pace, and competition from online retailers is growing. AutoZone fell 1.8% to $516.13. O’Reilly Automotive fell 1.2%, to $196. All three have taken steep losses this year.

Luxury retailer Coach sank 15.2% to $40.64 after its quarterly sales and its profit forecast for the current fiscal year fell short of analyst estimates.

Retailers of all kinds fell even though the Commerce Department said consumers did far more shopping in July, as retail sales grew by the biggest amount this year. Those sales have not beextremeen great in 2017.

Bond prices fell. The yield on the 10-year Treasury note rose to 2.27% from 2.22%. Bank stocks rose; Fifth Third Bancorp went up 1.3% to $27.02, and Discover Financial Services advanced 2.3% to $61.87.

Warren Buffett’s Berkshire Hathaway bought stock in consumer credit company Synchrony Financial and picked up more shares of Bank of New York Mellon. It sold its remaining shares of General Electric and continued to reduce its stake in IBM. Synchrony shares climbed 4.6% to $30.99. GE fell 0.9% to $25.14.

Offshore oil drilling rig company Transocean slid 5.7% to $7.91 after it said it will buy Songa Offshore for $1.2 billion in cash. The deal would expand Transocean’s backlog as it continues to deal with low oil prices, but it would saddle the company with even more debt. Transocean had about $6.6 billion in long-term debt at the end of June, and investors value the company at about $3 billion.

Pandora Media climbed 4.1% to $8.40 after the streaming music service named Dish executive Roger Lynch as its next CEO.

Extreme Networks leaped 11.5% to $10.39 after the San Jose network infrastructure equipment company posted stronger quarterly results than expected.

U.S. crude oil fell 4 cents to $47.55 a barrel in New York. Brent crude, the international standard, rose 7 cents to $50.80 a barrel in London. Energy companies slipped.

Wholesale gasoline stayed at $1.58 a gallon. Heating oil fell 1 cent to $1.60 a gallon. Natural gas fell 2 cents to $2.94 per 1,000 cubic feet.

Gold fell $10.70 to $1,279.70 an ounce. Silver lost 41 cents, or 2.4%, to $16.71 an ounce. Copper fell 2 cent to $2.88 a pound.

The dollar rose to 110.58 yen from 109.63 yen. The euro fell to $1.1734 from $1.1782.

France’s CAC 40 and Britain’s FTSE 100 both rose 0.4%. The German DAX ticked up 0.1%. In Japan, the benchmark Nikkei 225 gained 1.1%. Hong Kong’s Hang Seng slipped 0.3%. Markets in South Korea were closed for a national holiday.

UPDATES:

4 p.m.: This article was updated with market prices, context and analyst comment.

1:20 p.m.: This article was updated with the close of markets.

11:20 a.m.: This article was updated with market prices and context.

This article was originally published at 7 a.m.