Wild ride to nowhere: U.S. stocks rise, fall and repeat

NEW YORK—U.S. stocks careened between big gains and modest losses on Tuesday before indexes ended the day mixed, the latest dizzying run for a market that’s been dominated by them in recent months.

A morning burst driven by hopes for U.S.-China trade talks gave way to losses triggered by falling bank stocks and the threat of a federal government shutdown. The result of Tuesday’s trip through the spin cycle, though, belies all the action. Indexes ended the day nearly where they began.

The S&P 500 dipped by 0.94 points, or less than 0.1 percent, to 2,636.78, while the Dow Jones industrial average fell 53.02, or 0.2 percent, to 24,370.24, and the Nasdaq composite rose 11.31, or 0.2 percent, to 7,031.83. Slightly more stocks fell on the New York Stock Exchange than rose.

It’s the latest in a series of sharp turns in direction for the market, which has lurched up and mostly down since late September as investors recalibrate how worried they are about the global trade war, rising interest rates and expectations for a slowing economy.

The whipsaw action is a nerve-wracking departure from much of the past decade, when investors enjoyed a largely calm, rising market, and analysts are debating how big a turning point it is for the longest bull market on record.

Jon Adams, senior investment strategist at BMO Global Asset Management, is more optimistic that stocks can keep rising. But he says investors should get used to this increase in volatility, which follows a calmer-than-usual run.

Behind that volatility is many forces pushing and pulling the market in different directions, and how optimistic or pessimistic investors are feeling about them on a given day. Several were on display Tuesday.

Early in the morning, the S&P 500 jumped as much as 1.4 percent after China’s Commerce Ministry said that U.S. Treasury Secretary Steven Mnuchin and Chinese Vice Premier Liu He spoke by phone about “the promotion of the next economic and trade consultations.” Media reports also said that China agreed to reduce tariffs on U.S. autos. That raised hopes that the two countries can make progress on their trade dispute. Investors worry weaker global trade would dent economic growth around the world and corporate profits.

Indexes veered to losses in the afternoon, hurt by falling bank stocks. Financial stocks in the S&P 500 fell at least 1 percent for the fifth straight day, and the S&P 500 was down as much as 0.6 percent at one point Tuesday afternoon.

Also weighing on the market was President Donald Trump’s threat to shut down the government if Congress doesn’t provide money to build a wall at the Mexican border.

Benchmark U.S. crude oil rose 65 cents to settle at $51.65 per barrel. Brent crude, the international standard, gained 0.4 percent to $60.20.

Natural gas fell 14 cents to $4.41 per 1,000 cubic feet, heating oil was close to flat at $1.85 per gallon and wholesale gasoline rose 2 cents to $1.44 per gallon.