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Mar 20, 2017

Wall Street at Close Report on March 20, 2017: U.S. Stocks End Lower as Financials Sell Off



marketwatch.com
 
Victor Reklaitis, Anora Mahmudova
The main U.S. stock indexes closed marginally lower in a range-bound trade on Monday, making the third straight day of losses, as investors were reluctant to make big bets without major economic or corporate news.
In early trade, the Nasdaq Composite set an intraday all-time high, but settled within a few points of its previous closing record set earlier this month.
The S&P 500 index SPX, -0.20% closed off 4.8 points, or 0.2%, at 2,373.45, with seven of the 11 main sectors finishing in negative territory. Financials were the biggest decliners, putthing pressure on the main index. Meanwhile energy stocks tracked volatile oil prices, ending slightly lower as crude-oil prices recovered some of the sharp losses.
The Dow Jones Industrial Average DJIA, -0.04%  ended 8.76 points, or less than 0.1%, lower at 20,905.86, with two-thirds of the blue-chip companies closing in positive territory. Caterpillar Inc. CAT, +2.68%  and Nike Inc. NKE, +1.52%  lead the gains, closing up 2.7% and 1.5%, respectively while Home Depot Inc. HD, -1.20%  and Visa Inc. V, -1.17%  were the top decliners, losing 1.2%.
Meanwhile, the Nasdaq Composite Index COMP, +0.01% set an intraday high at 5,915.12 in early trade, but finish virtually unchanged at 5,901.53.
“At this stage sideways or a move lower on the S&P 500 would make sense and perhaps that what we are seeing after gains in February,” said Michael Antonelli, equity sales trader at Robert W. Baird & Co.
Market reaction to comments from Charles Evans, president of Chicago Federal Reserve were muted.
In an interview with Fox Business, Evans said he would support three rate hikes in total this year if economic improvement persists and four increases if inflation accelerates above the central bank’s 2% target.
His comments come after the policy-setting Federal Open Market Committee on Wednesday raised benchmark interest rates for the first time in 2017.
Some analysts suggested that investors are in a wait-and-see mode amid political uncertainty about new regulations.
“This is what we call a classic ‘backing and filling’ in the market. Investors may be somewhat clear about the monetary policy but now waiting to see what happens legislatively,” said Maris Ogg, president at Tower Bridge Advisors.
Ogg is optimistic about earnings over the next couple of years.
“We have one of the most business-friendly administrations which we expect to spur capital spending by companies, leading to better earnings growth,” she said.
SpaceX Dragon cargo spacecraft returns to Earth
The SpaceX Dragon capsule made a safe return to Earth on Sunday after leaving the International Space Station, bringing back with it a full load of space samples and other cargo.
Other markets: Oil futures CLJ7, -1.23%  fell on Monday, as some analysts blamed the drop on global growth worries after G-20 officials removed anti-protectionist language from a policy statement.
European equities SXXP, -0.17% lost ground, while Asian markets were mixed. Gold futures GCH7, +0.12%  stepped higher, and a key dollar index DXY, +0.01% was flat. The 10-year Treasury yield TMUBMUSD10Y, -1.55%  fell to 2.47%.
Economic news: Chicago’s Evans in an interview on the Fox Business cable channel said that he expected the U.S. economy grow at a 2.25% pace this year. He also suggested that if the economy continues to grow as expected and inflation flares up, he would support four rate hikes this year.
Read: Triangulating the dots — Fed’s Evans comments suggest he may be in three-hike camp
Stock movers: Energy shares were among top decliners on the S&P 500. Transocean Ltd RIG, -2.00%  and Chesapeake Energy Corp. CHK, -2.08%  were down 2%.
Shares of Tiffany & Co. TIF, +1.53%  rose 1.5% after analysts at William Blair upgraded the stock.
Walt Disney Co. DIS, +0.85%  shares gained 0.9% after ‘Beauty and the Beast’ topped the box-office ticket sales over the weekend.
U.S.-listed shares for Deutsche Bank AG DB, -3.42% DBK, -3.80% closed 3.7% lower after the German lender issued new shares to raise nearly $9 billion. The bank also indicated that it slashed bonuses paid to staff by 80% last year after suffering its second consecutive full-year loss.
Shares of Caterpillar Inc. CAT, +2.68%  were up 2.7% after the industrial-equipment maker reported encouraging February retail machine-sales data.