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The S & P 500 index and the Dow Jones Industrial Average advanced slightly on Monday, but fell against their session highs, a further decline in technology stocks having kept key indices under pressure.
Shares immediately jumped from the opening bell and then trimmed their early-afternoon earnings as technology-driven shares of companies, such as
Amazon.com
,
Netflix
and
Alphabet
fell again.
Dow industrialists earned up to 352 points before trading only 59 points, or 0.2%, to 24747. The S & P 500 index rose 0.3%, while the Nasdaq Composite index – which had started the day up – lost 0.6%.
Fragile trading has prolonged what has been a period of volatility for the stock market. Major indexes are expected to arrive at the end of October, recording their biggest loss in a month for years, weighed down by growing concerns about the health of the global economy as well as wider concerns over tightening. monetary policy.
On the one hand, many investors say the US economy remains strong. Data released on Monday shows that personal spending and American income rose in September, and a report showed that the US economy had grown faster than economists had expected in the third quarter.
A Red Hat logo is presented Monday on the floor of the New York Stock Exchange. IBM has agreed to buy the software and services company for about $ 33 billion.
Photo:
brendan mcdermid / Reuters
Some people, however, remain worried about the duration of the gains, especially with the rise in interest rates and the slowdown in tax cuts at the end of 2017, which should ease over the next few years. Shares of fast-growing companies in the technology and communications services sectors fell again on Monday, limiting the gains of major indices.
"I believe that to truly renew leadership and market confidence, growth stocks need to be stronger," said Patrick Spencer, Vice President of Equities at Baird. Yet, if you get "no [sign of] Recession, and perhaps a slightly more accommodating Fed, you could light a fire under this market, "he added. "Bear markets are almost always associated with the recession, and I do not see it on the horizon," he said.
A number of tech stocks under pressure last week resumed their slide Monday, which weighed on the Nasdaq, a large technology center. Netflix lost 5.9%, while Alphabet fell by 2.7% and Amazon.com by 5.4%, bringing its loss for the month to 24%.
Meanwhile, corporate news has caused fluctuations in the stock market on Monday.
Actions of
Red Hat
jumped 44% after
International Business Machines
has agreed to buy the software and services company for about $ 33 billion during the biggest acquisition of its history. IBM shares fell 3%.
Ford engine
jumped 3.9% after analysts Goldman Sachs raised their price target for the company and strengthened their rating for the title "buys" to "neutral".
In addition, the Stoxx Europe 600 was up 1% from its lowest close since December 2016.
Markets have reacted little to reports that Angela Merkel did not want to be re-elected as president of her conservative party after 18 years at the helm. The euro fell slightly against the dollar but remained stable at noon.
Italian stocks dominated gains, with the FTSE MIB benchmark up 2.1% and Italian debt yields down after S & P Global Ratings left the Italian debt rating unchanged but reduces its prospects to a negative perspective. Some investors expected a downgrade.
The European banking sector grew by 2.4%, with shares of
HSBC
Assets, one of the largest weighting factors in the index, contributed to higher gains after the bank reported controlling costs and exceeding earnings guidance for the third quarter.
The report also contributed to rising markets in Hong Kong, where the Hang Seng rose 0.4%.
Japan's Nikkei Stock Average edged down 0.2% and Mainland China's markets retreated after official data released this weekend by major Chinese industrial companies that announced much slower monthly earnings growth latest.
The Shanghai Composite Index fell 2.2%, mainly due to lower alcohol stocks following the quarterly decline in sales and profits from
Kweichow Moutai
,
The largest alcohol manufacturer in China.
Later this week, investors will monitor economic results, including a monthly jobs report released on Friday.
"If you are a bull, what are you still aspiring for?" Said Jim Paulsen, chief investment strategist at Leuthold Group. Very good economic reports are fueling concerns about the overheating of the economy, and the weakest are fueling concerns about the recession, he said. "How to get reports on the economy or results that are neither too hot nor too cold?"
– Saumya Vaishampayan contributed to this article.
Write to Riva Gold at [email protected] and Akane Otani at [email protected]
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