Wall Street slips as media stocks, Hurricane Irma weigh

By Lewis Krauskopf

(Reuters) - Wall Street edged lower on Thursday as media stocks weighed after negative business updates from Walt Disney and Comcast and as another powerful storm neared the United States.

Gains in healthcare stocks helped stem the losses, while strength in Microsoft , Amazon and biotech Gilead kept the tech-heavy Nasdaq in positive territory.

Comcast dropped 5.9 percent after the cable operator warned of subscriber losses, while Disney shares fell 5.0 percent after the company cautioned about its profit growth. The S&P 500 media index <.SPLRCME> was down 3.7 percent.

Investors were also tracking Hurricane Irma, which was bearing down on Florida on the heels of devastation in Texas caused by Hurricane Harvey. Irma plowed past the Dominican Republic toward Haiti after devastating a string of Caribbean islands.

 

With Irma looming, shares of insurers were weaker, with the Dow Jones U.S. Insurance index off 2.1 percent.

"There's further uncertainty because of Hurricane Irma that is supposed to be hitting Florida. You don't know what kind of damage it is going to do," said John Praveen, managing director at Prudential International Investments Advisers in Newark, New Jersey.

Combined with Harvey, in the short term, Praveen said, "maybe it will have a negative impact upon U.S. GDP growth and it might hurt U.S. earnings, and that's probably why the markets are reacting negatively."

The Dow Jones Industrial Average <.DJI> fell 42.72 points, or 0.2 percent, to 21,764.92, the S&P 500 <.SPX> lost 1.12 points, or 0.05 percent, to 2,464.42 and the Nasdaq Composite <.IXIC> added 3.38 points, or 0.05 percent, to 6,396.69.

Irma is the latest macro event to keep selling pressure on U.S. equities following concerns earlier this week about geopolitical tensions involving North Korea, which sparked the biggest one-day drop for the S&P 500 in about three weeks.

Still, the benchmark S&P remains near all-time highs, with market watchers pointing to strong earnings growth and solid economic data as helping to support stocks.

Investors were also digesting comments from European Central Bank President Mario Draghi, who said the euro's strength was already weighing on inflation and will be a key factor for the ECB next month when it decides how to proceed with its massive stimulus program.

General Electric shares sank 3.9 percent, dragging on the S&P and the Dow, after a bearish analyst note.

Apple shares also weighed on major indexes, falling 0.4 percent after a report that the company's new iPhone was hit with production glitches.

Financial shares <.SPSY> slid 1.9 percent amid a drop in U.S. Treasury yields.

Healthcare <.SPXHC> was the best-performing sector, rising 1.2 percent. AbbVie shares surged 6.3 percent and Bristol-Myers Squibb gained 5.6 after the drugmakers separately reported positive clinical updates on their respective medicines.

Eli Lilly shares rose 1.9 percent after the drugmaker said it would lay off about 8 percent of its employees.

Advancing issues outnumbered declining ones on the NYSE by a 1.01-to-1 ratio; on Nasdaq, a 1.03-to-1 ratio favoured decliners.

(Additional reporting by Sruthi Shankar in Bengaluru; Editing by Anil D'Silva)