NEW YORK (AP) — U.S. stocks are moving lower in morning trading Wednesday as traders keep a wary eye on a flare-up in tensions between India and Pakistan.
Pakistan said it shot down two Indian warplanes in the disputed region of Kashmir and captured a pilot. The incident worsened relations between the nuclear-armed rivals to a point not seen in the last twenty years.
The news overshadowed a mix of corporate earnings reports. Weight Watchers plunged to its lowest point in nearly two years after issuing a dismal forecast. Best Buy surged on surprising good holiday sales.
Traders are also closely watching testimony by President Donald Trump’s longtime fixer and personal lawyer, Michael Cohen. Cohen plans to tell a House committee that Trump knew ahead of time that WikiLeaks had emails damaging to 2016 Democratic rival Hillary Clinton’s presidential campaign and that Trump is a “racist,” a “conman” and a “cheat.”
Meanwhile President Trump and North Korean leader Kim Jong Un opened their second summit, in Vietnam, to talk about curbing North Korea’s pursuit of nuclear weapons.
KEEPING SCORE: The Dow Jones Industrial Average fell 150 points, or 0.6 percent, to 25,898 as of 10:15 a.m. Eastern time. The S&P 500 index fell 0.6 percent and the Nasdaq composite fell 0.8 percent.
SLIMMING DOWN: Weight Watchers shed 34 percent after the weight-loss program operator gave investors a surprisingly weak forecast. The company did not sign up as many subscribers as it hoped this winter and expects its profits to suffer.
Weight Watchers says it now expects to earn between .25 and .50 a share this year. Analysts polled by FactSet had been expecting .38 a share.
CEO Mindy Grossman says the company hopes to pull in more subscribers this spring, with high-profile investor Oprah Winfrey playing a central role in its upcoming TV and digital marketing campaign.
HOLIDAY HIGHS: Best Buy surged 16 percent after reporting that its holiday sales bucked a downward trend for retailers.
The electronics retailer’s profit beat forecasts, but more importantly a key retail sales measure continued growing during a tough quarter for the industry. The company also raised its quarterly dividend by 11 percent and its board of directors approved a billion stock buyback program.
OVERSEAS: European markets mostly fell as Britain continues to try to find an orderly way to exit the European Union. Prime Minister Theresa May is now giving Parliament the chance to delay Britain’s scheduled March 29 departure if lawmakers fail to approve her separationg agreement with the bloc.
Asian markets were mixed.