US stock indexes end unevenly after day of listless trading
U.S. stock indexes capped a day of listless trading with a mixed finish Monday, as gains by banks and technology companies were offset by losses in other sectors.
Bond yields rose, pointing to a pickup in interest rates on consumer loans, which helped drive bank shares higher. Technology stocks also posted solid gains, adding to the sector’s market-leading showing this year. Alphabet, Google’s parent company, surged in aftermarket trading after it reported its latest quarterly results.
Those gains were overshadowed by losses in industrial stocks, consumer goods companies and energy, among other sectors. More stocks fell than rose on the New York Stock Exchange.
Stocks mostly drifted in a narrow range for much of the day as investors sized up the latest batch of corporate quarterly results at the start of the busiest week in the reporting season.
“Earnings are coming in better than expected, but you’re not getting much of a reaction from the marketplace,” said Tom Martin, senior portfolio manager of Globalt Investments. “People are biding their time.”
The S&P 500 index rose 5.15 points, or 0.2 percent, to 2,806.98. The Dow Jones industrial average fell 13.83 points, or 0.1 percent, to 25,044.29. The Nasdaq gained 21.67 points, or 0.3 percent, to 7,841.87. The Russell 2000 index of smaller-company stocks picked up 1.61 points, or 0.1 percent, to 1,698.41.
The indexes are on pace to finish the month with gains. The S&P 500, the market’s benchmark index, is on a three-week winning streak.
Bond prices fell. The yield on the 10-year Treasury rose to 2.96 percent from 2.89 percent late Friday. The increase in bond yields helped lift bank shares. Interest rates on mortgages and other consumer loans tend to move in tandem with bond yields. Rising rates translate into bigger profits for banks. Wells Fargo added 2.8 percent to $58.
A third of the companies in the S&P 500 are set to report second-quarter earnings this week. So far, corporate earnings have been generally better than expected, reinforcing the underlying perception in financial markets that the U.S. economy is performing strongly and that the Federal Reserve will raise interest rates next month.
“The thing that’s been actually driving the earnings beats right now is just the fundamental performance of the companies,” said Jason Pride, chief investment officer Glenmede’s Private Wealth business. “It’s a good business environment.”
Out of the roughly 20 percent of companies in the S&P 500 that have reported quarterly results so far, 83 percent have turned in earnings that beat Wall Street’s expectations, Pride said, noting that company earnings growth so far is running 21 percent higher than in the same quarter last year.
Oil prices fell, erasing gains from earlier in the day. Benchmark U.S. crude dropped 37 cents to settle at $67.89 per barrel in New York. Brent crude, used to price international oils, slipped a penny to close at $73.06.