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Wall Street retreats from record on trade cloudiness

Published 10/31/2019, 04:21 PM
Updated 10/31/2019, 04:21 PM
© Reuters. Traders work on the floor at the NYSE in New York

By Chuck Mikolajczak

NEW YORK (Reuters) - U.S. stocks fell on Thursday as conflicting tones surrounding a possible trade deal between the United States and China eclipsed strong earnings reports from Apple and Facebook.

Mixed signals around trade gave investors reason for caution after a Bloomberg report said Chinese officials have doubts about whether it is possible to reach a comprehensive long-term trade deal with Washington and U.S. President Donald Trump.

But Trump later said the two countries would soon announce a site where a "Phase One" trade deal will be signed after Chile canceled a planned summit set for mid-November that was to be the venue for a signing.

The decline was the second for the S&P 500 in the past seven days, after the benchmark index notched intraday record highs in the past three sessions and a closing record in two of the past three days.

"They rallied this market so much in anticipation of not only the trade deal - but interest rates and everything else - this market would come in very quickly if in fact, word got out the Chinese are completely walking away," said Ken Polcari, senior market strategist at SlateStone Wealth LLC in Jupiter, Florida.

"Today’s action, with the market down, is absolutely nothing for anyone to get super concerned about because after the rally we have had for two weeks, you have to suspect at some point the market has to back off a little bit."

The trade-sensitive industrials sector (SPLRCI) lost 1.14%, while China-exposed chipmakers also fell, sending the Philadelphia Semiconductor index (SOX) down 0.62%.

However, corporate earnings were a bright spot. Apple Inc (O:AAPL) rose 2.26% after the iPhone maker forecast sales for the holiday shopping quarter ahead of expectations.

Facebook Inc (O:FB) gained 1.81% after reporting an uptick in users in lucrative markets and its third straight rise in quarterly sales growth..

The Dow Jones Industrial Average (DJI) fell 140.46 points, or 0.52%, to 27,046.23, the S&P 500 (SPX) lost 9.21 points, or 0.30%, to 3,037.56 and the Nasdaq Composite (IXIC) dropped 11.62 points, or 0.14%, to 8,292.36.

Earnings for the quarter are now expected to decline 0.8%, according to Refinitiv data, an improvement from the 2.2% decline expected at the start of the month.

Data on Thursday showed a marginal rise in consumer spending in September, casting doubts on consumers' ability to continue driving the economy, a key pillar of the current economic environment.

The Labor Department's October jobs data on Friday will be closely watched after the Fed signaled on Wednesday there would be no further cuts unless the economy takes a negative turn.

Among other stocks, Estee Lauder Cos Inc (N:EL) fell 3.62% after the cosmetics maker cut its forecast for full-year profit.

Kraft Heinz Co (O:KHC) jumped 13.44% as the packaged foods company said it was spending more on marketing key brands next year, after reporting a better-than-expected third-quarter profit.

Declining issues outnumbered advancing ones on the NYSE by a 1.66-to-1 ratio; on Nasdaq, a 1.67-to-1 ratio favored decliners.

© Reuters. Traders work on the floor at the NYSE in New York

The S&P 500 posted 26 new 52-week highs and 5 new lows; the Nasdaq Composite recorded 71 new highs and 83 new lows.

Latest comments

Sorry Chris, you, like the NBA being scolded by China,"Know your role, shut your hole". This comment was brought to you by people who want to suppress human rights and CONTROL free markets and currencies.
Donald Trumpet coined the word 'fake news'. He creates fake news. He is unreliable thus an incompetent prez. Thus he has no depth. Donald Trumpet is a con man. People initially fall for a con man. Con men typically have insufficient education. Lack of grammar is proof of that. "FovWev" anyone? Con men typically live in a fantasy world where they believe the junk they act out will be acceptable. ---- The press laps up every word this con man prez Donald Trumpet trumpets into the world, fake news or not. ==== Does a con man have substance? Con men are addicted to pulling the wool over the masses' head and stuffing their own pocket in the process. ======= Con men create fake news to dupe you, rob you, steel from you, like saying: "Look there!" and then grabbing your belongins and running away when you turn your head back to face the con man and discovering you have been robbed. --- Donald Trumpet gooses the stock market higher with ABSOLUTELY BASELESS FANTASIES. Donald Trumpet is a fraud!
I agree with everything you said but one thing. Trump didnt coin the phrase. As a matter of fact, Hillary Clinton was using the expression before Trump, but Trump certainly made it more popular. Maybe it’s because his base cant use big words and live off of soundbites due to a general inability to read.
don't mind trump ,market will be fime
Oh it will be “Fime.”
"Fresh" ?? It never left. ... #LOL #SameOldStory
We hitting $28k before thanksgiving.
Up didn't last long. why write the headline when it only last 3 minutes. Reuter is inept.
These markets are attracting normal people to put savings in it and big investors are taking their money out of the markets. Markets will go down soon. Please be smart and take your money out.
We need to be honest, until this time there is no direct and significant impact from trade war to people anywhere..
are you hi
I agree. Off course it's lowering the desire for investments amongst corporates, but nearly as much as nearly all economists claim. Economic expansion has lasted longer than ever and was set for a pause and a shallow recession eventually. The longer FED postpones the inevitable, the longer lasting and deeper it'll get.
Donald trumpet is closely related to capital market gambler one day it will surely surface
that is tru, he plays with us and always wins :(
He shines the heck out of partha.
the biggest hedge fund manager in WH is Mnuchin.
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