Wall Street flat as investors test post-election rally

Home / In the News / Wall Street flat as investors test post-election rally
By Yashaswini Swamynathan

Wall Street was little changed on Wednesday as investors assessed whether a post-election rally, which powered the major indexes to a series of record highs in the past month, had more room to run.

Investors have been flocking to sectors such as financials and industrials, which are most likely to benefit from President-elect Donald Trump’s proposals of more fiscal stimulus and simpler regulations.

“When we have run up so high, it’s common that there is some sensitivity in the market, maybe due to softer oil prices or just the technical aspects of being at such high levels,” said Peter Cardillo, chief market economist at First Standard Financial in New York.

Since the Nov. 8 election, the Dow Jones industrial average .DJI has risen 5 percent, the S&P 500 3.4 percent and the Nasdaq 2.7 percent.

While an interest rate hike at the Federal Reserve’s meeting next week is a foregone conclusion, investors are on the lookout for how the central bank views Trump’s pro-growth policies and whether that could lead to more aggressive rate hikes next year.

Traders are pricing in a 92 percent chance of a rate hike at the meeting, according to Thomson Reuters data.

At 9:40 a.m. ET (1441 GMT), the Dow Jones Industrial Average .DJI was down 1.58 points, or 0.01 percent, at 19,250.2.

The S&P 500 .SPX was down 2 points, or 0.09 percent, at 2,210.23 and the Nasdaq Composite .IXIC was down 13.16 points, or 0.25 percent, at 5,319.84.

Losses in healthcare .SPXHC and technology .SPLRCT weighed slightly on the three indexes.

Eight of the 11 major S&P 500 sectors were higher, while losses in Pfizer (PFE.N), Celgene (CELG.O) and Johnson & Johnson (JNJ.N) dragged the healthcare sector down 1.27 percent.

Pfizer fell 2.2 percent to $30.84 after Britain’s competition watchdog fined the drugmaker $107 million for its role in ramping up the cost of an epilepsy drug by as much as 2,600 percent. The stock was the top drag on the S&P.

Celgene lost 3.4 percent to $113.55 following its announcement that it would not further test a combination of its breast cancer drug Abraxane with chemotherapy.

Western Digital (WDC.O) rose 4.8 percent to $67 after the data storage maker raised its second-quarter profit and revenue forecasts. The stock was the top percentage gainer on the S&P.

Restaurant and arcade chain operator Dave & Buster’s (PLAY.O) soared 13.5 percent to $54.50 following upbeat quarterly results and a raised full-year revenue forecast.

Wendy’s (WEN.O) rose 4.2 percent to $13.50 after activist investor Nelson Peltz raised his stake in the burger chain to 23.45 percent.

Advancing issues outnumbered decliners on the NYSE by 1,620 to 990. On the Nasdaq, 1,158 issues fell and 1,073 advanced.

The S&P 500 index showed 30 new 52-week highs and five new lows, while the Nasdaq recorded 76 new highs and eight new lows.

(Reporting by Yashaswini Swamynathan in Bengaluru; Editing by Sriraj Kalluvila and Saumyadeb Chakrabarty)

Want a simpler portfolio strategy with amazing returns?

Only $24.99 Full color Paperback copy

Leave a Reply