Smaller firms and banks posts losses to trigger fall in SU stocks

Smaller firms and banks posts losses to trigger fall in SU stocks

US stocks slipped today as smaller companies and banks took their worst losses in a few months.

With stock indexes near record highs, investors moved some money into big-dividend stocks like real estate firms.

Banks and other financial companies have been climbing over the last two months but today they skidded as interest rates moved lower.

Small, domestically-focused companies had their worst day since mid-August as House Republicans began making changes to their tax bill.

Their Senate counterparts are expected to introduce their own bill soon.

Smaller companies tend to pay higher tax rates than their bigger peers because they make more of their money in the US and do not have as many ways to reduce their taxes.

"Financials would be a primary beneficiary of a 20% corporate tax rate because they're domestically based and they pay domestic taxes," said Quincy Krosby, chief market strategist at Prudential Financial.

Travel booking companies TripAdvisor and Priceline both plunged while Weight Watchers continued to surge after it raised its forecasts for the year.

The Standard & Poor's 500 index dipped 0.49 points to 2,590.64. The Dow Jones industrial average added 8.81 points to 23,557.23, another record high.

The Nasdaq composite fell 18.65 points, or 0.3%, to 6,767.78. The Russell 2000 index tumbled 18.87 points, or 1.3%, to 1,479.09.

Banks fell along with bond yields and interest rates. Both have moved lower over the last few days, which reduces the profits banks make from lending.

The yield on the 10-year Treasury note slipped to 2.31% from 2.32%.

JPMorgan Chase fell $2.03, or 2%, to $98.75 and US Bancorp lost $1.40, or 2.6%, to $53.45.

Red Robin Gourmet Burgers plunged after it slashed its profit forecast.

It pointed to higher labour costs and said it will temporarily stop opening new locations at the end of its next fiscal year.

The stock lost $19.35, or 28.9%, to $47.70.

Consumer products distributor Core-Mark fell $3.07, or 9.1%, to $30.63 after it cut its outlook.

Travel website TripAdvisor plunged after its third-quarter revenue fell short of analyst estimates.

Booking service Priceline Group had a better-than-expected quarter but its forecasts for the current quarter disappointed Wall Street.

TripAdvisor sank $9.18, or 23.2%, to a five-year low of $30.35 while Priceline lost $257.28, or 13.5%, to $1,645.72.

Benchmark US crude fell 15 cents to $57.20 a barrel in New York.

Brent crude, used to price international oils, dipped 58 cents to $63.69 a barrel in London.

AP


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