Stocks were lower on Wall Street in afternoon trading on Friday, giving up modest gains following a generally upbeat assessment of the economy from Fed Chair Janet Yellen. Phone companies and utilities, widely considered safe-play stocks, led the list of decliners. AT&T and Verizon each fell more than 1 percent.
YELLEN UPBEAT: Federal Reserve Chair Yellen said in a speech that the Fed is moving toward raising interest rates in light of a solid job market and an improved outlook for the U.S. economy and inflation. But she stopped short of signaling any timetable for the next rate hike.
BOND REACTION: After initially rising after Yellen’s speech, U.S. government bond prices fell. The yield on the 10-year note, which moves in the opposite direction of the price, rose to 1.66 percent from 1.54 earlier Friday. The yield was 1.58 percent late Thursday.
THE QUOTE: “She suggests the economy is improving, but the GDP numbers for the past three quarters are closer to 1 percent than three percent,” said Bruce Bittles, chief investment strategist at R.W. Baird. “That is very anemic.”
HERBALIFE FALLS: Herbalife fell $2.02, or 3 percent, to $59.91 after the Wall Street Journal reported that Carl Icahn, the company’s biggest shareholder and defender, has been trying to unload his stake. Federal regulators recently ordered the company to change its sales practices, but did not agree with Wall Street critics that it was a pyramid scheme.
SOFTWARE SURGE: Design software company Autodesk rose $5.04, or 8 percent, to $68.74 after reporting a small profit, beating expectations of a loss.
PROFIT PICTURE: Earnings per share for companies in the S&P 500 index are expected to fall 1.8 percent in the second quarter, according to S&P Global Market Intelligence. That would be the fourth quarter in a row of drops.
ONE MAN’S VIEW: “We’ve been in a bit of an earnings recession,” said Thomas Wilson, senior investment manager at Brinker Capital, but stocks are holding near record highs because financial analysts expect earnings to “go up” toward the end of the year.
OVERSEAS: Britain’s FTSE 100 rose 0.3 percent, Germany’s DAX gained 0.6 percent, and France’s CAC 40 climbed 0.8 percent. Japan’s Nikkei 225 fell 1.2 percent after consumer prices fell the most in three years in July. Hong Kong’s Hang Seng index rose 0.4 percent.
OIL: Benchmark U.S. crude oil rose 23 cents to $47.56 a barrel. Brent crude, used to price oil internationally, rose 30 cents to $49.97 a barrel.
CURRENCIES: The dollar rose to 101.72 yen from 100.57 yen the previous day. The euro fell to $1.1209 from $1.1281.