BUSINESS US stocks shed some of their early gains on last day of 2018


US stocks shed some of their early gains on last day of 2018


01:20, January 01, 2019


(File Photo: AFP)

US stocks were headed lower in morning trading Monday after an early rally fueled by hopes for progress in resolving trade frictions between the US and China faded. Gains in health care companies outweighed losses in internet companies, energy stocks and elsewhere in the market. The benchmark S&P 500 index was on track for its worst showing in a decade after a volatile year on Wall Street.

KEEPING SCORE: The S&P 500 index rose 6 points, or 0.2 percent, to 2,491 as of 11:25 am. The Dow Jones Industrial Average gained 88 points, or 0.4 percent, to 23,151. The Nasdaq lost 8 points, or 0.1 percent, to 6,576. The Russell 2000 index of smaller-company stocks gave up 4 points, or 0.3 percent, 1,333.

Trading has been highly volatile in December, capping a year of turbulence for markets. The major indexes closed last week with their first weekly gain in what’s been an otherwise painful month. The indexes are still all down around 10 percent for the month and on track for their worst December since 1931.

THE QUOTE: “Last week we really had such a volatile week, and a lot of that had to do with thin trading volumes, some computerized trading and investors just being exhausted from a very difficult fourth quarter,” said Jeff Kravetz, regional investment strategist at U.S. Bank Wealth Management. “Today is the last day of the year and investors are starting to look into next year.”

US-CHINA TRADE: Investors drew encouragement from a tweet from President Donald Trump on Sunday, in which the president said he had a “long and very good call” with Chinese President Xi Jinping. Trump added: “Deal is moving along very well. If made, it will be very comprehensive, covering all subjects, areas and points of dispute. Big progress being made.” Meanwhile, the official Xinhua News Agency cited a Chinese Foreign Ministry spokesman as saying that “China stands ready to work with the United States to move forward the China-U.S. ties which are underpinned by coordination, cooperation and stability.”

Stocks also got a boost in early December when the U.S. and China agreed to a truce on trade, but then plunged when it was unclear what exactly both sides had agreed upon.

LOUSY YEAR: The S&P 500 index, the market’s main benchmark, is on track for a loss of 6.5 percent this year, or 5.2 percent once dividends are included. The last time the index fell for the year on that basis was in 2008 during the financial crisis, when it lost 37 percent. The S&P 500 posted tiny losses in 2011 and 2015, but eked out small gains in both years once dividends were included.

THAT HEALTHY FEELING: Health care stocks were among the biggest gainers. Regeneron Pharmaceuticals rose 2.4 percent to $371.40.

READY TO SHOP: Traders bid up shares in department store chains and other retailers. Best Buy gained 1.5 percent to $52.13. Kohl’s rose 1.8 percent to $66.24.

WEAK SIGNALS: Shares in internet service providers and media companies slumped. DISH Network lost 3.6 percent to $24.07. Facebook slid 1.6 percent to $131.03.

ENERGY: Crude oil prices turned lower, giving up early gains. Benchmark U.S. crude oil fell 0.6 percent to $45.05 a barrel in New York. Brent crude, the benchmark for international prices, slid 0.4 percent to $52.98 a barrel in London.

The decline in oil prices pulled energy stocks lower. Schlumberger dropped 3.5 percent to $35.33.

BOND YIELDS: Bond prices rose. The yield on the 10-year Treasury note fell to 2.72 percent from 2.73 percent late Friday.

CURRENCIES: The dollar fell to 109.80 yen from 110.41 yen on Friday. The euro strengthened to $1.1447 from $1.1442.

OVERSEAS: In Europe, the CAC 40 of France rose 1.1 percent, ending the year down about 11 percent. Britain’s FTSE 100 closed down 0.1 percent for an annual loss of 12.5 percent. Germany’s DAX, which was closed Monday, has been one of the worst-performing European indexes. It ended in a bear market, down 22 percent from a high in January and 18 percent from the start of the year.

Earlier in Asia, Hong Kong’s Hang Seng rose 1.3 percent, while India’s Sensex gained 0.2 percent. Australia’s S&P ASX/200′s benchmark slipped 0.1 percent. Most other markets were closed for the New Year holiday.

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