Investing.com - A day after the phase one U.S. China trade deal was finally struck, a hangover set in.
Stocks finished with very small gains Friday, led mostly by tech stocks. The rest of the market struggled.
The S&P 500 was basically flat, although the index did finish with a record close of 3,168.80. The Dow industrials rose 0.01%, or 3 points, as gains for Apple (NASDAQ:AAPL), Microsoft (NASDAQ:MSFT), American Express (NYSE:AXP) and others were offset by struggles for Boeing (NYSE:BA) shares.
The Dow finished the day about 29 points below its peak close of 28,164 on Nov. 27.
All of the major indexes hit intraday peaks soon after the open but then faded.
The Nasdaq Composite added 0.2%. The Nasdaq 100 rose 0.25%. Both were record closes. The gains were basically due to Apple (NASDAQ:AAPL), Microsoft (NASDAQ:MSFT), Adobe Systems (NASDAQ:ADBE), Comcast (NASDAQ:CMCSA) and Amazon.com (NASDAQ:AMZN).
Declines in Facebook (NASDAQ:FB), facing antitrust concerns, chipmaker Broadcom (NASDAQ:AVGO), which reported weak earnings, and Advanced Micro Devices (NASDAQ:AMD), subtracted 11 points from the index.
The hangover was probably a result of traders (or their computers) buying the rumor (the U.S.-China trade deal was coming), and then selling the news (the trade deal is here).
There was also disappointment in a retail sales report from the Commerce Department coming in lower for November than expected.
Except that it won't be signed until January and texts weren't available to show the details. The deal includes Chinese purchases of grains and other farm products and a commitment to crack down on patent piracy and other measures. In return, the U.S. agreed to reduce tariffs on $120 billion in products to 7.5% from 15%. That reduction will take effect 30 days after the agreement is signed. New tariffs that had been scheduled for Dec. 15 won't go into effect.
While President Donald Trump crowed about the deal, other officials, including economic advisor Larry Kudlow, were surprisingly wary of it. The deal will offer some confidence for business, Kudlow told CNBC Friday afternoon, but "we will see how it works. We will see if the Chinese stay with their word."
And U.S. stocks didn't move higher after Britain's Tory Party scored their big electoral victory Thursday. British stocks rallied on the news with the benchmark FTSE 100 up 1.1%.
The market overall ended the week with small gains -- about 0.4% for the Dow, 0.7% for the S&P 500 and 0.9% for the Nasdaq.
With 11 trading days left in 2019, the S&P 500 is up 26.4% for the year. The Dow is up 20.6%, and Nasdaq is up 31.6%. The year-to-date gains are the best for the indexes since 2013.
Gold moved up on the trade deal's uncertainties. Agricultural futures were higher. Soybean futures rose nearly 1% in Chicago to $9.075 a bushel on the trade news. Soybeans are up only 1.4% on the year and are still down 35.6% from their close at the end of 2012.
Oil jumped with West Texas Intermediate crude settling above $60 a barrel for the first time since July, a signal that traders see OPEC's moves to cut production pushing prices higher.
East Coast utility PPL (NYSE:PPL), Gulf Coast electric utility CenterPoint Energy (NYSE:CNP), software giant Adobe Systems (NASDAQ:ADBE), cell-phone tower company SBA Communications (NASDAQ:SBAC) and software company Intuit (NASDAQ:INTU) were among the top S&P 500 performers.
Hanesbrands (NYSE:HBI), cosmetic company Coty (NYSE:COTY), fashion retailer L Brands (NYSE:LB), athletic foot ware retailer Foot Locker (NYSE:FL) and chip maker Broadcom (NASDAQ:AVGO) were the weakest S&P 500 companies.
Interest rates shot up Thursday, as stocks rallied on the trade news. They fell on Friday. The 10-Year Treasury yield fell to 1.823% from Thursday's 1,899%.