The News Herald (Willoughby, OH)
S&P 500 index slips, posts down week
Shares of department stores sank again, hurt by more evidence that shoppers are turning away from them.
NEW YORK >> Shares of department stores sank again Friday, hurt by more evidence that shoppers are turning away from them. A drop in Treasury yields also put pressure on bank stocks, and the weakness helped pull the Standard & Poor’s 500 index to its first weekly loss in the last four.
The S&P 500 dipped 3.54 points, or 0.1 percent, to close at 2,390.90, part of a 0.3 percent loss for the week. The index is still within half a percent of its record, though, and the market continues to make only modest moves through what’s become a weekslong, peaceful lull.
The Dow Jones industrial average fell 22.81 points, or 0.1 percent, to 20,896.61, and the Nasdaq composite rose 5.27 points, or 0.1 percent, to 6,121.23. Small-company stocks fell more than the rest of the market. The Russell 2000 index lost 7.43 points, or 0.5 percent, to 1,382.77.
The biggest loss in the S&P 500 came from Nordstrom, which plunged $5.01, or 10.8 percent, to $41.20 after it said a key sales figure weakened last quarter by more than analysts expected. Nordstrom joined a long list of other department-store chains that have reported discouraging results recently, as their customers increasingly head online.
J.C. Penney fell 74 cents, or 14 percent, to $4.55 after it reported a loss for its latest quarter and weaker revenue than analysts expected. The broader market, though, was much more pacific. It was the 13th straight day that the S&P 500 moved by less than 0.5 percent, the longest such streak since 1995.
“It’s extremely calm, which always makes us a little nervous,” said Eric Marshall, portfolio manager at Hodges Capital Management. “We’re in a very narrow market and a very thin market: It’s hard to buy things, and it’s hard to sell things because the amount of trading volume out there has slowed down in recent weeks.”
The market has grown sleepier as companies have reported stronger-than-expected profits and as encouraging data lifted optimism about the global economy. The calmness also comes despite a spate of political jolts, including concerns about how successful Republicans in Washington will be at pushing through the pro-business changes that many investors are expecting.
A government report on Friday showed that shoppers picked up their spending at auto dealers, hardware stores and online shops last month, and retail sales rose 0.4 percent from March. That was below economists’ expectations, but it’s an acceleration from weak levels registered earlier in the year. It also may be an indication that the economy will indeed pick up from its early-year torpor, as many economists predict.
Consumer prices also picked up a bit of momentum in April. Prices rose 0.2 percent last month, following a drop of 0.3 percent in March, as energy prices climbed higher. But after excluding energy and food prices, inflation was weaker last month than economists were expecting.
The Federal Reserve is paying close attention to inflation as it raises interest rates off their record lows, particularly where it is after excluding energy and food prices, which can be volatile.