US Stocks Drift to Mixed Close Thursday01/21 16:02
U.S. stock indexes capped a day of choppy trading with a mixed finish
Thursday, though solid gains by technology companies helped lift the S&P 500
and Nasdaq composite to more record highs.
(AP) -- U.S. stock indexes capped a day of choppy trading with a mixed
finish Thursday, though solid gains by technology companies helped lift the S&P
500 and Nasdaq composite to more record highs.
The S&P 500 edged up less than 0.1%. Traders bid up shares in Big Tech
stocks, including Apple, Amazon and Facebook. Those gains helped outweigh
losses in energy stocks, banks and elsewhere. Stocks in smaller companies,
which have led the way higher this year, gave up some of their recent gains.
Stocks have been mostly grinding higher this month amid optimism that
COVID-19 vaccines will lead to an economic recovery and expectations that
Washington will deliver more stimulus for the economy. More recently,
better-than-expected results from companies reporting quarterly results have
helped keep U.S. stock indexes hovering near record highs or notching new ones.
"Today is similar to yesterday in the sense that the broad indexes are flat
or higher, but it's actually the tech names that have taken leadership again,"
said Ross Mayfield, investment strategy analyst at Baird.
The S&P 500 rose 1.22 points to 3,853.07, even as more stocks in the index
closed lower. The Dow Jones Industrial Average slipped in the final minutes of
trading, shedding 12.37 points, or less than 0.1%, to 31,176.01. The tech-heavy
Nasdaq composite climbed 73.67 points, or 0.6%, to 13,530.91. The Russell 2000
index of smaller companies fell 19.20 points, or 0.9%, to 2,141.42.
Optimism about a strengthening economy later this year has been powerful
enough to paper over worries about today's struggles. On Thursday, a report
showed that 900,000 U.S. workers filed for unemployment benefits last week, as
the worsening pandemic forces businesses to shut down and lay off employees.
The number was less terrible than the prior week's 926,000, but it's still
Wall Street has actually seen such miserable numbers as a reason for
optimism in the past, perversely, because they add urgency on Congress to
deliver more aid for the economy.
President Joe Biden has already proposed a $1.9 trillion plan, including
$1,600 cash payments for most Americans and other assistance for the economy.
Even though his Democratic party controls both houses of Congress, the proposal
will likely face resistance given how slim the majority is.
Other reports on the economy were more encouraging on Thursday, including
better-than-expected data on the homebuilding industry and manufacturing in the
More companies are also telling investors how badly their profits got hit
during the last three months of 2020, when coronavirus counts and deaths were
soaring. Wall Street came into this earnings reporting season with low
expectations, forecasting a fourth straight quarter of profit declines. But
most companies have been topping expectations.
"We are hearing more positive guidance from the (company) earnings calls,"
said Quincy Krosby, chief market strategist at Prudential Financial. "That's
important because this is a market that's looking ahead."
Travelers rose 2.6% after the insurer reported a much stronger profit for
the latest quarter than analysts expected.
Homebuilders rose following the encouraging report on housing starts, led by
Beazer Homes USA's 5.1% gain. Paccar climbed 10.5% for the biggest gain in the
S&P 500 after saying it will partner with autonomous-vehicle company Aurora to
develop self-driving Peterbilt and Kenworth trucks.
On the losing end was United Airlines, which lost 5.7% after reporting a
worse loss for the end of 2020 than analysts expected. The worsening pandemic
is keeping fliers out of the skies, and the company's forecast for revenue at
the start of 2021 fell short of analysts' expectations.
The yield on the 10-year Treasury rose to 1.10% from 1.07% late Wednesday.
Besides optimism about vaccines and the prospect for more stimulus from
Washington, huge actions by central banks around the world are also helping to
prop up stock markets. The Federal Reserve has its first policy meeting of the
year next week, and it has said it doesn't expect to pull interest rates off
their record lows anytime soon. Low rates can help push up prices for stocks
and other investments.
The European Central Bank on Thursday said it would hold interest rates
steady and leave its bond-purchase stimulus program unchanged.