Take a breath: Stocks slow down after a record-set­ting run

The Trentonian (Trenton, NJ) - - BUSINESS - By Stan Choe

NEW YORK >> The Stan­dard & Poor’s 500 in­dex dipped Thurs­day to break a seven-day win­ning streak, its long­est in three and a half years, though it re­mains a nudge away from its record high.

It was part of a pause for stock mar­kets around the world, which have been on a tor­rid run thanks to an im­prov­ing econ­omy, stronger cor­po­rate earn­ings and hopes for more busi­ness-friendly poli­cies from Wash­ing­ton. The dol­lar’s value also dipped against ri­val cur­ren­cies, and Trea­sury yields fell as bond prices rose.

The S&P 500 fell 2.03 points, or 0.1 per­cent, to 2,347.22. The Dow Jones in­dus­trial av­er­age rose 7.91 points, less than 0.1 per­cent, to set an­other record at 20,619.77. The Nas­daq com­pos­ite dipped 4.54 points, or 0.1 per­cent, to 5,814.90. Four stocks fell for ev­ery three that rose on the New York Stock Ex­change.

An­a­lysts said it wasn’t sur­pris­ing to see stocks take a break fol­low­ing their long run higher.

“The mar­ket has re­acted quite strongly to the Trump re­fla­tion trade, dereg­u­la­tion and lower-tax com­ments over the last cou­ple weeks,” said Nate Thooft, se­nior port­fo­lio man­ager at Man­ulife As­set Man­age­ment. “And on top of that we’ve had a pretty darn good earn­ings sea­son. It just needs a lit­tle bit of a breather to­day.”

He said he still sees stocks as bet­ter in­vest­ments than bonds.

The day’s largest loss within the S&P 500 came from TripAd­vi­sor, which fell $5.78, or 11 per­cent, to $46.92 after re­port­ing weaker rev­enue and earn­ings for its latest quar­ter than an­a­lysts fore­cast.

Avon Prod­ucts, a di­rect seller of cos­met­ics, also plunged after re­port­ing weak­erthan-ex­pected re­sults. The com­pany said the num­ber of sales rep­re­sen­ta­tives, who are fa­mous for sell­ing its prod­ucts door to door, slipped from a year ear­lier. The stock dropped $1.09, or 18.6 per­cent, to $4.77.

Most com­pa­nies, though, have been re­port­ing stronger re­sults for the last three months of 2016 than Wall Street fore­cast.

Med­i­cal-waste com­pany Ster­i­cy­cle jumped to the big­gest gain in the S&P 500 after its earn­ings and rev­enue for the latest quar­ter topped an­a­lysts’ es­ti­mates. The stock rose $5.96, or 7.7 per­cent, to $83.35.

Cisco Sys­tems gained 78 cents, or 2.4 per­cent, to $33.60, and data-stor­age com­pany NetApp climbed $1.63, or 4.2 per­cent, to $40.56 after like­wise re­port­ing larg­erthan-ex­pected prof­its.

Hand­bag maker Kate Spade climbed after the com­pany said it is con­sid­er­ing op­tions that could in­clude a sale. Its stock, which traded around three-year lows in De­cem­ber, jumped $2.89, or 14.7 per­cent, to $22.56.

Trea­sury yields pulled back, giv­ing back some of their in­crease from prior days. The 10-year Trea­sury yield fell to 2.45 per­cent from 2.50 per­cent late Wed­nes­day. The two-year Trea­sury yield fell to 1.21 per­cent from 1.25 per­cent, and the 30-year yield fell to 3.05 per­cent from 3.08 per­cent.

Yields fell even as more en­cour­ag­ing re­ports on the econ­omy ar­rived. Home­builders broke ground on slightly more projects last month than econ­o­mists ex­pected, though ac­tiv­ity was down from the prior month. A mea­sure of man­u­fac­tur­ing in the Philadelphia re­gion sug­gested that growth is im­prov­ing, and that fig­ure also beat fore­casts.

The re­ports fol­lowed two big ones on Wed­nes­day, which showed that ris­ing op­ti­mism among shop­pers may be trans­lat­ing into in­creased spend­ing and that in­fla­tion is on the rise. Con­tin­ued signs of gains in the econ­omy and on in­fla­tion could push the Fed­eral Re­serve to raise in­ter­est rates sooner or more quickly than in­vestors had thought.

Stock mar­kets around the world also slowed Thurs­day. In Europe, the French CAC 40 fell 0.5 per­cent, the Ger­man DAX in­dex fell 0.3 per­cent and the U.K. FTSE 100 also slipped 0.3 per­cent. In Asia, Ja­pan’s Nikkei 225 in­dex fell 0.5 per­cent, the South Korean Kospi dipped 0.1 per­cent and the Hang Seng in Hong Kong rose 0.5 per­cent.

Bench­mark U.S. crude rose 25 cents to set­tle at $53.36 per bar­rel. Brent crude, the in­ter­na­tional stan­dard, fell 10 cents to $55.65 a bar­rel. Nat­u­ral gas fell 7 cents to $2.85 per 1,000 cu­bic feet. Heat­ing oil was close to flat at $1.63 per gal­lon, and whole­sale gaso­line fell 2 cents to $1.52 per gal­lon.

Gold rose $8.50 to set­tle at $1,241.60 per ounce, sil­ver rose 11 cents to $18.07 per ounce and cop­per fell 2 cents to $2.72 per pound.

RICHARD DREW — THE ASSOCIATED PRESS FILE

Stocks around the world pulled back Thurs­day fol­low­ing a record-set­ting run that marked the long­est win­ning streak in over 3 years for the S&P 500 in­dex. U.S. stock in­dexes held close to their all-time highs. The dol­lar’s value fell against ri­val cur­ren­cies, and Trea­sury yields dipped.

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