Stocks

Wall St ends flat amid rate hopes, tech declines

Reuters NEW YORK | Updated on September 10, 2019 Published on September 10, 2019

US stocks ended flat on Monday as increased expectations of stimulus from central banks around the world were offset by losses in technology and healthcare shares.

Investors also appeared to pull back from buying after the market posted solid increases last week, strategists said. Microsoft Corp was the day's biggest drag on the S&P 500 and Nasdaq.

The S&P 500 financial index was among the day's best-performing groups, rising 1.5 per cent, with banks gaining 3.2 per cent and US Treasury yields up on rising bets of an interest rate cut at the US Federal Reserve's September meeting.

Cementing those expectations, Fed Chairman Jerome Powell said late last week the central bank would “act as appropriate” to sustain economic expansion, a phrase that financial markets have read as a sign of an impending rate cut.

“This is kind of the eye of the storm,” as investors await more news on interest rates or trade, said Paul Nolte, portfolio manager at Kingsview Asset Management in Chicago. But, he said, “for the market to move significantly higher from here, we'd really need to see something happen on trade.”

Stocks rose last week largely on easing worries about US-China trade negotiations.

This week, the European Central Bank is expected to introduce new stimulus measures at its meeting on Thursday. “The market is absorbing those gains from last week, and ... is in a wait-and-see regarding the European Central Bank meeting,” said Quincy Krosby, chief market strategist at Prudential Financial in Newark, New Jersey. The Dow Jones Industrial Average rose 38.05 points, or 0.14 per cent, to 26,835.51, the S&P 500 lost 0.28 point, or 0.01 per cent, to 2,978.43 and the Nasdaq Composite dropped 15.64 points, or 0.19 per cent, to 8,087.44.

Earlier on Monday, US Treasury Secretary Steven Mnuchin said he did not see the threat of a recession as the Trump administration seeks to revive trade negotiations with China, adding he expected a positive year ahead for the US economy.

In healthcare, Amgen fell 2.6 per cent after analysts raised questions about data on the company's lung cancer drug, while the S&P 500 healthcare index was down 0.9 per cent. The S&P 500 technology index ended down 0.7 per cent.

Among gainers, energy stocks rose along with oil prices. Among other stocks, AT&T Inc gained 1.5 per cent after shareholder Elliott Management Corp disclosed a $3.2 billion stake in the company and pushed for changes.

Boeing Co fell 1.2 per cent after it suspended load testing of its new widebody 777X aircraft over the weekend as media reports said a cargo door failed in a ground stress test.

Advancing issues outnumbered declining ones on the NYSE by a 1.49-to-1 ratio; on Nasdaq, a 1.51-to-1 ratio favored advancers. The S&P 500 posted 38 new 52-week highs and three new lows; the Nasdaq Composite recorded 63 new highs and 59 new lows.

Volume on US exchanges was 7.42 billion shares, compared with the 6.77 billion-share average for the full session over the last 20 trading days.

Published on September 10, 2019
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