S&P marks its long­est skid in 36 years

Daily Local News (West Chester, PA) - - BUSINESS - By Ken Sweet AP Busi­ness Writer

NEW YORK >> The slow, steady re­treat of the stock mar­ket ahead of the 2016 elec­tion con­tin­ued Fri­day, with the mar­ket fall­ing for a ninth straight day. Wall Street is now in its long­est pe­riod of de­cline in more than three decades.

In­vestors con­tinue to fo­cus on the U.S. pres­i­den­tial elec­tion, which has be­come too close for com­fort for some in­vestors and has put the mar­ket on the de­fen­sive.

The Dow Jones in­dus­trial av­er­age lost 42.39 points, or 0.2 per­cent, to 17,888.28. The Stan­dard & Poor’s 500 in­dex lost 3.48 points, or 0.2 per­cent, to 2,085.18 and the Nas­daq com­pos­ite lost 12.04 points, or 0.2 per­cent, to 5,046.37.

The last time the S&P 500 fell for nine straight days is De­cem­ber 1980, nearly 36 years ago. Ron­ald Rea­gan wasn’t even pres­i­dent yet.

How­ever the nine days’ worth of de­clines has been rel­a­tively mi­nor, com­par­a­tively speak­ing. The

S&P 500 fell 9.4 per­cent dur­ing the 1980 nine-day los­ing streak, ac­cord­ing to Howard Sil­verblatt at S&P Global Mar­ket In­tel­li­gence, com­pared with the 3.1 per­cent de­cline in this sell-off.

In­vestors point to one rea­son for the drop: Don­ald Trump.

With only a few days left un­til the elec­tion, Hil­lary Clin­ton is still lead­ing in na­tional polling but Trump ap­pears to have con­sid­er­ably nar­rowed the gap, par­tic­u­larly in swing states. In­vestors like cer­tainty, and Clin­ton is seen as likely to main­tain the sta­tus quo. Trump’s poli­cies are less clear, and the un­cer­tainty and un­com­fort­able close­ness of the polls has caused jit­ters in fi­nan­cial mar­kets.

“Some in­vestors are afraid of Don­ald Trump be­com­ing pres­i­dent,” said Michael Scan­lon, a port­fo­lio man­ager at Man­ulife As­set Man­age­ment.

Other port­fo­lio man­agers and mar­ket strate­gists have made sim­i­lar com­ments, say­ing that it is likely a drop would con­tinue on Wall Street if Trump were to pre­vail, at least in the short term. The VIX, a mea­sure of volatil­ity nick­named Wall Street’s “fear gauge” be­cause it al­lows in­vestors to bet on how much the stock mar­ket will swing in the next 30 days, has surged 40 per­cent this week. It is at its high­est level since June, when Bri­tain voted to leave the Euro­pean Union.

“No one re­ally knows what Trump would do should he get into power, prob­a­bly not even him­self,” said Joshua Ma­hony, mar­ket an­a­lyst at IG. “It is that un­cer­tainty that is driv­ing the mar­ket neg­a­tiv­ity that has dom­i­nated this week.”

Some en­cour­ag­ing news on the U.S. econ­omy did keep the mar­ket higher most of the day, but the gains faded in the last hour of trad­ing. Traders did not want to hold po­si­tions into the week­end with the elec­tion and re­treated to their usual ham­lets of safety: U.S. govern­ment bonds and gold.

U.S. em­ploy­ers added a solid 161,000 jobs in Oc­to­ber and raised pay sharply for many work­ers. The La­bor Depart­ment’s monthly em­ploy­ment re­port Fri­day sketched a pic­ture of a re­silient job mar­ket. The pace of hir­ing has been con­sis­tent with a de­cent econ­omy. The un­em­ploy­ment rate fell to 4.9 per­cent from 5 per­cent. And av­er­age hourly pay took a big step up, ris­ing 10 cents an hour to an av­er­age of $25.92. That is 2.8 per­cent higher than a year ago and is the sharpest 12-month rise in seven years.

“This is re­ally good for the U.S. con­sumer, es­pe­cially as we head into the crit­i­cal hol­i­day shop­ping sea­son,” Scan­lon said.

With the elec­tion com­ing up in less than a week, the Oc­to­ber jobs re­port is likely to give the Fed­eral Re­serve enough am­mu­ni­tion to raise in­ter­est rates at its De­cem­ber meet­ing, econ­o­mists said. Fed pol­i­cy­mak­ers ended a two-day meet­ing on Wed­nes­day where they de­cided to hold rates steady.

“It seems that the only re­main­ing ob­sta­cle to the Fed hik­ing in De­cem­ber would be a sig­nif­i­cant ad­verse fi­nan­cial mar­ket re­ac­tion to the U.S. pres­i­den­tial elec­tion,” said Chris Wil­liamson, chief busi­ness econ­o­mist at IHS Markit, in an email.

In com­pany news: GoPro, the maker of wear­able cam­eras, lost 78 cents, or 6.5 per­cent, to $11.16. The com­pany re­ported a 40 per­cent drop in rev­enue in the quar­ter, and gave a neg­a­tive out­look for the hol­i­day sea­son. Like Fit­bit, GoPro is show­ing signs of be­ing un­able to ex­pand the au­di­ence for its prod­uct line. The stock did re­cover part of an ear­lier loss.

In en­ergy, bench­mark U.S. crude oil lost 59 cents to $44.07 a bar­rel on the New York Mer­can­tile Ex­change. Brent crude, the in­ter­na­tional stan­dard, de­clined 77 cents to $45.58 a bar­rel in Lon­don.

Heat­ing oil fell 3 cents to $1.43 a gal­lon, whole­sale gaso­line fell 4.5 cents to $1.38 a gal­lon and nat­u­ral gas fu­tures fell less than 1 cent to $2.767 per 1,000 cubic feet.

U.S. govern­ment bond prices rose. The yield on the 10-year Trea­sury note fell to 1.78 per­cent from 1.81 per­cent the day be­fore.

The euro rose to $1.1117 from $1.1109 and the dol­lar rose to 103.13 yen from 102.99 yen.

Gold rose $1.20 to $1,304.50 an ounce, sil­ver fell 5 cents to $18.37 an ounce and cop­per rose 2 cents to $2.27 a pound.

THE AS­SO­CI­ATED PRESS

Shares fell Fri­day as ner­vous in­vestors fret­ted over the po­ten­tial out­come of next week’s nail-bit­ingly close U.S. pres­i­den­tial elec­tion.

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