For the second day in a row, the market is up, today to the tune of 33 points on the Dow, even though there was once again nothing but bad news, at least not much else reported.  But the 33 points was enough to put the Dow at another record high, mostly on positive results from Chevron.  But Amazon, Exxon, Starbucks and the entire tobacco sector disappointed.  The Q2 earnings forecast is now up to 10.8%, up from 10.7 yesterday.  The rest of the history is in yesterday’s report but just a reminder that it was at 8 percent just a couple weeks ago.  The market is widely feared to be overvalued so investors are depending on a strong Q2 to justify prices and continue confidence that this bull run still has legs.  Last night’s healthcare failure has investors concerned about the rest of the Trump agenda and we may see that reflected in Monday’s data.  Meanwhile, volume is back to recent averages at 6.1 billion.

fri JULY 28, 2017 / 6:37 pM

S&P 500 dented by earnings; Dow hits record high

Lewis Krauskopf

DJ: 21,830.31  +33.76     NAS: 6,374.68  -7.51       S&P: 2,472.10  -3.32     7/28

(Reuters) - The S&P 500 slipped on Friday on negative reactions to earnings reports from high-profile names such as Amazon, Exxon and Starbucks and a drop in shares of tobacco companies.  The Dow industrials, however, set a record high, buoyed by Chevron (CVX.N) after the energy company's results.  Despite Friday's share reactions, results overall have come in better than expected for the second quarter and stocks are trading near record highs.

More than halfway through reporting season, S&P 500 companies are on track to increase earnings by 10.8 percent, according to Thomson Reuters I/B/E/S.

Investors were also digesting data showing the U.S. economy accelerated in the second quarter as consumers ramped up spending and businesses invested more on equipment.

“We have had a good earnings season. We have had pretty good economic results," said Bruce McCain, chief investment strategist at Key Private Bank in Cleveland.

"But I think that there’s a tendency after you have had too long a string of wins, to start looking for the problems in even the good data. And I get the sense that that is kind of what is going on in the market at this point.”

The Dow Jones Industrial Average .DJI rose 33.76 points, or 0.15 percent, to 21,830.31, the S&P 500 .SPX lost 3.32 points, or 0.13 percent, to 2,472.1 and the Nasdaq Composite .IXIC dropped 7.51 points, or 0.12 percent, to 6,374.68. 

Investors have been counting on earnings to support the relatively high valuations for equities. The S&P 500 is trading at about 18 times earnings estimates for the next 12 months above its long-term average of 15 times.

“I would call the market at the high end of fairly valued,” said Peter Tuz, president of Chase Investment Counsel in Charlottesville, Virginia. "It is not blanket good earnings as Amazon exemplifies."

Amazon's (AMZN.O) shares fell 2.5 percent after the world's largest online retailer reported a jump in retail sales along with a profit slump.  Altria Group (MO.N) shares tumbled 9.5 percent. The U.S. Food and Drug Administration announced it wants to reduce nicotine levels in cigarettes and move smokers toward potentially less harmful e-cigarettes.  Altria, which makes Marlboro brand cigarettes, was the biggest drag on the S&P 500 and weighed heavily on the consumer staples sector .SPLRCS, which was the worst-performing group.  U.S.-traded shares of British American Tobacco (BTI.N) dropped 7.0 percent. 

Exxon (XOM.N) shares fell 1.5 percent after a rare earnings miss, while shares of rival oil major Chevron climbed 1.9 percent after its results.  Starbucks (SBUX.O) plunged 9.2 percent and Mattel (MAT.O) dropped 7.8 after their respective reports.

Following the failure of Senate Republicans to dismantle the Affordable Care Act, investors were also weighing the impact on the rest of President Donald Trump's agenda, including tax cuts, that has supported the stock market.

Healthcare .SPXHC was the best-performing sector, rising 0.5 percent.

About 6.1 billion shares changed hands in U.S. exchanges, roughly in line with the 6-billion average over the last 20 sessions.

Advancing issues outnumbered declining ones on the NYSE by a 1.16-to-1 ratio; on Nasdaq, a 1.17-to-1 ratio favored decliners.