Despite Late U.S. Rally, Financial And Resource Stocks Take Hit

U.S. stocks trimmed some of their earlier losses but still finished lower after retail sales and consumer sentiment fell more than analysts forecast. The slide snapped a four-day run higher for Blue Chips, with both the Dow Jones Industrials and the S&P 500 indices backing away from record highs. Energy and material stocks took the hardest hits as the price of oil, gold and other metals slid in commodities trade. Financial stocks also were sharply lower after improved Q1 earnings at JPMorgan Chase & Co and Well Fargo & Co. failed to impress investors.

March retail sales lagged expectations, falling 0.4% last month with weakness observed in most categories. The unexpected decline -- most analysts were expecting little or no change last month -- follows a 1.0% rise in February and marks the sharpest decline since last June, sparking new concerns that higher payroll taxes and a tough job market are taking a bite out of consumer spending.

Also Friday, the Thomson Reuters/University of Michigan preliminary index of consumer sentiment declined to a nine-month low of 72.3 this month, down from a 78.6 mark in March. The April reading was lower than all 69 estimates in a Bloomberg survey that called for no change from the March number. In particular, consumers' assessments of their financial situation deteriorated.

The Commerce Department reported a 0.6% drop in producer prices, the biggest one-month drop in wholesale prices since last May. Excluding food and energy, core PPI rose 0.2% for the third-straight month. Economists had been expecting a 0.3% monthly fall in headline PPI and a 0.2% gain in core producer prices, according to MarketWatch.

Earnings
In company news, JPMorgan Chase (JPM) and Wells Fargo (WFC) worked to keep a lid on financial stocks Friday despite both banks posting improved quarterly profits.

JPM reported Q1 earnings of $1.59 per share, up from $1.19 per share last year and beating the analyst consensus by $0.21. But revenue declined 3.7% compared to year-ago levels to $25.8 bln, in-line with expectations, while most of its major businesses turned in tepid performances.

WFC reported a higher-than-expected Q1 profit, with per-share earnings of $0.92 beating analyst estimates by $0.03 per share. Its mortgage business, however, showed further signs of slowing and net interest margins continued to shrink, falling short of analyst expectations. Revenue also fell 1.7% to $21.26 billion, trailing forecasts by around $140 mln.

Commodities were broadly lower. Crude oil for May delivery fell $2.20, or just over 2%, to settle at $91.29 per barrel. Natural gas was one of the few gainers, with the May contract rising 8 cents to end at $4.22 per 1 million BTU. Gold continued its slide, with the June contract tumbling $63.50, or 4.1%, to $1,501.40 - its lowest price since November 2011 after earlier falling below $1,500. May silver was down $1.37, or 4.9%, to finish at $26.33 per ounce while May copper fell 8 cents at $3.35 per pound.

Here's Where The U.S. Markets Stood At Day's End

• Dow Jones Industrial Average down 0.08 (-0.00%) to 14,865.06
• S&P 500 down 4.52 (-0.28%) to 1,588.85
• Nasdaq Composite Index down 5.21 (-0.16%) to 3,294.95

• Hang Seng Index down 0.06%
• Shanghai China Composite Index down 0.58%
• FTSE 100 Index down 0.49%

• (+) CLNT, Adjusted earnings rise 238.5% over year-ago comparisons to $0.98 per share. Quarterly revenue climbs 28.3% to $17.6 mln.
• (+) RALY, Prices initial public offering of 6 mln shares of its common stock at $14 apiece, above its expected range of $11 to $13 a share.
• (+) RATE, Stifel Nicolaus upgrades stock to Buy from Hold with a $17 a share price target.
• (+) ASH, Jana Partners takes 7.4% stake in the chemicals company, paying $390.5 mln to acquire 5.8 mln shares, according to regulatory filings.

• (-) OSH, Wall Street Journal reports that the hardware retailer has hired restructuring lawyers as it faces a large, upcoming debt payment and pursues talks with its lenders.
• (-) CRMB, Selling up to $10 million of its senior unsecured convertible promissory notes to accredited investors. Also, reports 2% decline in Q4 net sales to $10.8 mln, trailing analyst estimates by $1.8 mln.
• (-) INFY, Q4 revenue rises 9.4% to $1.94 bln but trails analyst forecasts by about $50 mln. Says FY14 revenue should rise 6% to 10%, also lagging the analyst view looking for 11% growth.
• (-) NG, Reports $0.05 per share Q1 net loss, reversing $0.07 per share profit in year-ago quarter.