New York, Oct 18 (AP) Wall Street shares were volatile in afternoon trading on Monday as markets slowed their pace after their best week since July. The S&P 500 rose 0.2 percent as of 2:45 p.m. Eastern, with the stock slightly higher than the decline. The Dow Jones Industrial Average fell 76 points, or 0.2 per cent, to 35,217 and the Nasdaq was up 0.7 per cent.
Technology stocks and companies that relied on direct consumer spending posted broad gains, but were hit by losses from health care and other companies. Chipmaker Nvidia rose 1.8 percent and Target rose 2.8 percent. Medical device company Medtronic fell 5.3 percent. Energy stocks posted gains as US crude oil prices jumped losses from small gains. So far this year, the prices have gone up about 70 per cent. Occidental Petroleum rose 3.3 per cent. The mix of retailers and other companies that rely on consumer spending also increased.
The yield on the 10-year Treasury rose to 1.58 per cent from 1.57 per cent late Friday. The broader markets have been in turmoil for weeks as investors try to figure out the way forward for the economy as COVID-19 continues to pose a threat, while businesses and consumers face rising inflation. The S&P 500 rose 1.8 percent last week for its best week since July, though it dropped 2.2 percent just two weeks ago.
The S&P 500 is still within about 1.2 percent of its all-time high set on Sept. 2, even with swings within the broader market. Most of the churn is caused by various sectors, such as technology stocks, shifting from major gains to major losses on any given day. “For now, we’re going to maintain this kind of rotational correction,” said Liz Ann Saunders, chief investment strategist at Charles Schwab. It’s just that as each pocket goes through moments of weakness, there are pockets of strength. that brings it out.” Investors are busy reviewing the latest round of corporate earnings for a better picture of how companies fared through a surge in virus cases last quarter and how they are coping with the impact of rising inflation on costs.
A wide range of companies have warned that supply chain problems are crippling operations and could dent their finances for the rest of the year. Wall Street is concerned that as businesses face higher costs, they will pass them on to consumers and this could lead to increased spending and a broader economic recovery. Health care giant Johnson & Johnson will report its latest results on Tuesday, as will streaming entertainment service Netflix. Investors will have a better sense of how airlines are recovering when several major carriers report results this week. United Airlines will report its latest results on Tuesday, with American Airlines and Southwest Airlines reporting their results on Thursday.
A mix of non-earnings news affected many stocks. Television broadcast company Sinclair Broadcasting fell 3.5 percent after reporting a data breach. Toyota rose 1 percent after announcing plans to build a $1.29 billion factory in the US to make batteries for gas-electric hybrids and fully electric vehicles. Investors also have a lot of economic data to review this week. The Federal Reserve on Monday reported a surprisingly large drop in industrial output. About half of the 1.3 percent drop was due to the effects of Hurricane Ida.
Wall Street will get more information on the health of the housing market this week, with the Commerce Department’s report on Tuesday starting September and the National Association of Realtors’ report Thursday on sales of previously occupied homes in September. (AP).
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