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US stocks inch higher after day of ups and downs

Published 13/07/2016

US stocks have inched higher (AP)
US stocks have inched higher (AP)

US stocks inched up to another record on Wednesday after spending much of the day flitting between gains and losses.

After big moves up in recent days, investors appeared to take a bit of breather. They nudged stocks higher at the open, then sent them down, then back up in indecisive trading that set the tone for the rest of the day.

In the last half hour, the Standard and Poor's 500 crept to a tiny gain, closing up less than a third of a point, an increase of just 0.01%.

Still, it was another high, and a winning streak that began with a strong US jobs report on Friday stretched into a fourth day.

Investors are hoping the strengthening economy combined with low interest rates will help lift corporate profits and the appetite for stocks.

"Good economic numbers could translate into decent second quarter earnings, and rates are low," said Ernie Cecilia, chief investment officer of Bryn Mawr Trust. That makes for a "decent environment" for stocks.

Utility companies rose more than the rest of the market, though, a sign that investors are cautious as they seek out the relative safety of steady dividend payers. Investors also sought safety in US government bonds, sending yields lower.

The yield on the 10-year Treasury note, which had been rising since hitting an all-time low last week, dropped to 1.47% from 1.51%.

The S&P 500 edged up 0.29 points to 2,152.43. The Dow Jones industrial average rose 24.45 points, or 0.1%, to 18,372.12. The Nasdaq composite lost 17.09 points, or 0.3%, at 5,005.73.

Rising oil prices have brought relief to the stock market in recent months, but the price reversed course Wednesday after the US government said crude oil stockpiles shrank less than expected last week. Hess slumped 2.11 US dollars, or 3.5%, to 58.02 dollars and Devon Energy lost 1.01 dollars, or 2.5%, to 39 dollars.

Eight of the 10 biggest losers in the S&P 500 were energy-related companies.

For all the recent gains in stocks, the major indexes are barely above their old records a year ago.

"In essence, we have a stock market that has given us zero gains but plenty of heartaches," said James Abate, chief investment officer at Centre Asset Management.

Investors will turn their attention to second quarter earnings reports over the next few days. Earnings per share at companies in the S&P 500 are expected to fall 5.5 percent compared with the same period a year ago, according to research firm S&P Global Market Intelligence. That will be the fourth quarter in a row of drops.

On Thursday, JP Morgan Chase and Delta Air Lines report, followed by Citigroup and Wells Fargo on Friday.

Among stocks making big moves, Juno Therapeutics soared 2.63 dollars, or 9.5%, to 30.42 dollars after regulators said its leukemia drug trials can continue. The stock had tumbled Friday after the Food and Drug Administration halted testing.

Arts and crafts chain Michaels fell 1.75 dollars, or 6%, to 27.13 dollars after a disappointing forecast. It said it plans to sell stock to raise money.

AP

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