|
NEW YORK (CNNMoney.com) -
Stocks mostly closed lower Tuesday at the end of a strong month, amid higher oil prices, worries about rising interest rates and declines in financials and the automakers.
As of 6 p.m. ET, Nasdaq and S&P futures pointed to a flat open for stocks, when fair value is taken into account.
The Dow Jones industrial average (down 82.29 to 10,805.87, Charts) lost almost 0.8 percent and the broader S&P 500 (down 8.00 to 1,249.48, Charts) index lost more than 0.6 percent.
The Nasdaq composite (down 0.01 to 2,232.82, Charts) was flat, with gains in Internet and semiconductor stocks keeping it steady.
Wednesday's session was choppy as investors welcomed strong reads on third-quarter gross domestic product growth and manufacturing in the Midwest but grew more concerned that the spate of good news lately means higher interest rates.
Such concerns coincided with some investor exhaustion after a five-week rally, causing declines Wednesday. Weakness in General Motors and Ford and the financial stocks, as well as a spike in oil prices added to the day's doldrums.
However, the last three days of sluggish trading have been a blip in an otherwise strong month, in which the Dow gained 3.5 percent, the S&P 500 gained 3.6 percent and the Nasdaq gained 5.3 percent.
"We saw some profit taking at month's end, that's all," said Timothy Ghriskey, chief investment officer at Solaris Asset Management. "November was a very strong month for stocks. We made back what was lost in October and more."
Falling energy prices, a resilient economy and strong earnings news all fed a November rally that set the major gauges at or near four-and-a-half year highs.
While many of those factors remain in play and could support stocks through the end of the year, a few more days of consolidation are probably in order, Ghriskey said.
One factor that has changed recently is the movement in the oil market.
After selling off for most of the fall, oil prices seem to be bobbing near the high 50 a barrel range lately. For another big round of stock gains to kick in, oil prices would probably need to resume the downward push, Ghriskey said.
Thursday brings a slew of economic news: the weekly jobless claims report, November auto sales, reads on personal income and spending, construction spending and manufacturing.
Oil gains, inflation woes
U.S. light crude oil for January delivery gained 82 cents to settle at $57.32 a barrel on the New York Mercantile Exchange Wednesday. The price of crude had traded on both sides of breakeven following the release of the mixed weekly oil inventories report.
"For the first time in a while we saw a bid in energy prices," said Art Hogan, chief market analyst at Jefferies & Co. "We can't seem to hang on to a gain this week."
The Fed's "beige book" survey, which came out at 2 PM, failed to move the markets much as it shed little new light on economic conditions.
The survey said economic activity picked up in November, but the housing market had cooled and inflation remains a concern, particularly due to energy prices.
The survey of the Fed's 12 districts is used by the central bank in making decisions about short-term interest rates.
Markets were mixed earlier in the day after the government said GDP grew at a 4.3 percent annual rate in the third quarter versus an earlier estimate of 3.8 percent. Economists surveyed by Briefing.com expected growth of 4 percent. GDP grew at a 3.3 percent rate in the second quarter.
While this was positive, it may have also revived interest rate and inflation concerns, said James Awad, president at Awad Asset Management.
Such concerns may have been further stoked by the mid morning release of the Chicago PMI, a read on manufacturing in the Midwest.
The index showed slower manufacturing growth in November than October, in a read that was nonetheless above economists' forecasts. However, the report's inflation component jumped.
On the move
Twenty-seven of 30 Dow components slipped, led by General Motors (down $1.10 to $21.90, Research). Both GM and rival Ford (down $0.40 to $8.13, Research) lost close to 5 percent one day ahead of the monthly auto sales.
GM has continued to slide over the last week even after announcing a major restructuring last week.
Dow components J.P. Morgan (down $0.71 to $38.25, Research) and American Express (down $0.71 to $51.42, Research) both slipped as well, joining a weak financial sector.
On the upside, the influential chip sector jumped, bouncing back after two down sessions. The Philadelphia Semiconductor (up 5.86 to 481.64, Charts) index, or the SOX, gained 1.2 percent.
Research in Motion (down $3.79 to $61.13, Research) slumped, but failed to drag down the broader tech sector. The stock plunged after a judge refused to enforce a controversial $450 million patent settlement between the BlackBerry maker and patent holding company NTP Inc.
The judge will now rule on whether RIM will have to suspend BlackBerry sales in the U.S.
Market breadth was mixed. On the New York Stock Exchange, losers edged winners by a narrow margin on volume of 1.79 billion shares. On the Nasdaq, advancers topped decliners four to three on volume of 1.92 billion shares.
Treasury prices inched lower, raising the yield on the 10-year note to 4.48 percent from 4.47 percent late Tuesday. Treasury prices and yields move in opposite directions.
The dollar was little changed versus the euro and rose slightly versus the yen.
COMEX gold for December delivery fell $4.50 to settle at $494.60 an ounce.
|
