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Stocks slip on Wall Street as traders watch US-Iran tensions US stock indexes slip, but rush for safety slows
(32 minutes later)
NEW YORK — Stocks are closing lower on Wall Street as investors wait for the next step in the increasingly tense U.S.-Iran confrontation. Oil prices gave up some of their recent gains after a U.S. drone strike killed Iran’s top general on Friday. Banks and makers of consumer products took some of the bigger losses. JPMorgan Chase fell 1.7%. The S&P 500 fell 9 points, or 0.3%, to 3,237. The Dow Jones Industrial Average fell 119 points, or 0.4%, to 28,583. The Nasdaq slipped 2 points, less than 0.1%, to 9,068. Bond prices fell. The yield on the 10-year Treasury note rose to 1.83%. NEW YORK — U.S. stocks mostly fell on Tuesday, but the big rush for safety that coursed through global markets after the United States killed a top Iranian general on Friday slowed.
THIS IS A BREAKING NEWS UPDATE. AP’s earlier story follows below. Gold’s momentum eased a day after touching its highest price in nearly seven years, several Asian and European stock markets clawed back much of their losses from Monday and benchmark U.S. crude dropped for the first time in four days. The S&P 500 dipped but remains within 0.6% of its record, and a measure of fear in the stock market moved lower.
U.S. stocks were mixed in afternoon trading on Tuesday, and gold and crude oil prices took a pause from their recent run as investors wait for the next step in the increasingly tense U.S.-Iran confrontation. The market’s return to a wait-and-see approach wasn’t that surprising to some investors, even as talk remained tough in the increasingly tense U.S.-Iran confrontation. U.S. officials were preparing for an Iranian response to their drone strike against Gen. Qassem Soleimani.
Benchmark U.S. crude dropped for the first time since before the United States killed Iranian Gen. Qassem Soleimani in a drone strike on Friday, a move that threatened to disrupt oil supplies in the Middle East and caused prices to spurt higher for days. The potential for war also sent dollars flowing out of risky investments like stocks and into gold and other safer harbors. The market may be more focused on the upcoming earnings season for U.S. companies and the forecasts that CEOs will give for 2020 profits, said Rich Weiss, senior portfolio manager at American Century Investments. After a year where the S&P 500 surged roughly 30%, despite profits for big companies falling, he said investors will need to see more solid growth to justify near-record prices.
Asian and European stock markets clawed back much of their losses from Monday even as U.S. stocks were split. Three out of fives tocks in the S&P 500 fell, with drops for oil companies helping to offset modest gains for raw-material producers. “We definitely pay attention and are keeping an eye on” the U.S.-Iran tensions, Weiss said. “But it’s not what we alter investment strategy on.”
Gold slowed its momentum a day after touching its highest price in nearly seven years, and Treasury yields were also little changed. “The market seems to be looking right past” the tensions, he said. “I’m much more concerned about the fundamentals. The lack of earnings visibility is troubling.”
The market’s return to a wait-and-see approach wasn’t that surprising to some investors, at least in hindsight. The S&P 500 remains within 0.6% of its record set on Thursday. The S&P 500 fell 9.10 points, or 0.3%, to 3,237.18. The Dow Jones Industrial Average lost 119.70, or 0.4%, to 28,583.68, and the Nasdaq composite slipped 2.88, or less than 0.1%, to 9,068.58.
Rich Weiss, senior portfolio manager at American Century Investments, said the market may be more focused on the forecasts that companies will give in upcoming weeks for their 2020 earnings than on the U.S.-Iran tensions. Energy stocks dropped with the price of crude. Benchmark U.S. oil fell 57 cents to settle at $62.70 per barrel. It had jumped more than $2 per barrel over the last two days. Brent crude, the international standard, fell 64 cents to $68.27 a barrel.
“The market seems to be looking right past it,” Weiss said. “It seems to be much more interested in the fundamentals: interest rates, earnings and trade tensions.” That helped drag Halliburton down 2.8% and Chevron down 1.3%. Apache was an outlier, and the oil and gas producer surged 26.8% for the biggest gain in the S&P 500 after it and Total said they found a significant amount of oil off the coast of Suriname.
KEEPING SCORE: The S&P 500 was down 0.2% as of 3 pm. Eastern time. Asian stock markets had some of the day’s strongest gains and clawed back much of their losses from Monday. Japan’s Nikkei 225 jumped 1.6%, South Korea’s Kospi rose 0.9% and Hong Kong’s Hang Seng added 0.3%.
The Dow Jones Industrial Average fell 102 points, or 0.4%, to 28,600, and the Nasdaq composite rose by less than 0.1%.
MARKETS ABROAD: Asian markets had some of the day’s strongest gains and clawed back much of their sharp losses from Monday.
Japan’s Nikkei 225 jumped 1.6%, South Korea’s Kospi rose 0.9% and Hong Kong’s Hang Seng added 0.3%.
In Europe, Germany’s Dax returned 0.8%. France’s CAC 40 and the FTSE 100 in London were virtually flat.In Europe, Germany’s Dax returned 0.8%. France’s CAC 40 and the FTSE 100 in London were virtually flat.
TAKE A BREATH: Gold slowed its momentum and rose $5.50 to settle at $1,574.30 per ounce. It had climbed more than $16 each of the last two days as investors piled into what they thought could hold steady even if a war broke out in the Middle East. Gold slowed its momentum and rose $5.60 to settle at $1,571.80 per ounce. It had climbed more than $16 each of the last two days as investors piled into what they thought could hold steady even if a war broke out in the Middle East.
U.S. officials were preparing for an Iranian response to their drone strike against Soleimani and warned ships about the possibility of action against U.S. interests in Mideast waterways or other retaliations. Treasury yields climbed modestly after a pair of reports showed that U.S. manufacturing continues to wane, but not by enough to drag down the rest of the economy. The 10-year Treasury yield rose to 1.82% from 1.81% late Monday. The two- and 30-year yields also inched higher.
DRILLED: Benchmark U.S. crude gave up some of its big gains made in recent days on worries about supplies. It dropped 57 cents to settle at $62.70 per barrel. It had jumped more than $2 per barrel over the last two days.
Brent crude, the international standard, fell 64 cents to $68.27 a barrel.
That helped put at least a temporary halt to the recent rise for energy stocks. Chevron fell 1.7%, Exxon Mobil lost 1.2% and Schlumberger fell 1.2%.
EXCEPTION: Apache was an outlier, and the oil and gas producer surged 24.9 % for the biggest gain in the S&P 50 after it and Total said they found a significant amount of oil off the coast of Suriname.
YIELDS: The yield on the 10-year Treasury inched up to 1.82% from 1.81% late Monday.
ECONOMIC SIGNS: A pair of reports showed that U.S. manufacturing continues to wane, but not by enough to drag down the rest of the economy.
Manufacturing has been weak in the country and around the world, hurt by tariffs and trade wars, and a U.S. Commerce Department report showed that factory orders fell 0.7% in November from a month earlier. It was the third drop in the last four months.Manufacturing has been weak in the country and around the world, hurt by tariffs and trade wars, and a U.S. Commerce Department report showed that factory orders fell 0.7% in November from a month earlier. It was the third drop in the last four months.
But even with that weakness, the solid U.S. jobs market and spending by households have helped prop up the rest of the economy. A separate report released Tuesday morning showed that the nation’s services industries grew at a faster pace last month than economists expected. The reading includes activity in the retail, health care and other industries.But even with that weakness, the solid U.S. jobs market and spending by households have helped prop up the rest of the economy. A separate report released Tuesday morning showed that the nation’s services industries grew at a faster pace last month than economists expected. The reading includes activity in the retail, health care and other industries.
In commodities trading, wholesale gasoline fell 3 cents to $1.72 per gallon. Heating oil was unchanged at $2.03 per gallon. Natural gas rose 2 cents to $2.16 per 1,000 cubic feet.
Silver rose 22 cents to $18.32 per ounce, and copper was little changed at $2.80 per pound.
The dollar rose to 108.53 Japanese yen from 108.46 yen on Monday. The euro fell to $1.1145 from $1.1192.
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AP Business Writer Elaine Kurtenbach contributed.AP Business Writer Elaine Kurtenbach contributed.
Copyright 2020 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.Copyright 2020 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.