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US stocks shake off early losses; trading remains wobbly

US stock indexes are mostly higher as big-dividend companies including utilities rise, but technology companies continue to slump

Reported by: AP [ Published on: October 15, 2018 21:30 IST ]
Image Source : AP US stocks shake off early losses; trading remains wobbly

NEW YORK (AP) — Trading on Wall Street remains uneven Monday as U.S. stocks head slightly higher after some sharp early losses. Technology companies continue to slump, but high-dividend stocks like household goods makers and real estate companies are gaining ground. The S&P 500 and other major U.S. indexes are coming off their worst week since late March as investors worry about rising interest rates and trade tensions between the U.S. and China. Bank of America dropped after it reported disappointing growth in loans.

KEEPING SCORE: The S&P 500 index added 3 points, or 0.1 percent, to 2,770 as of 11:30 a.m. Eastern time. The Dow Jones Industrial Average rose 79 points, or 0.3 percent, to 25,419. The Nasdaq composite dipped 13 points, or 0.2 percent, to 7,483. The Russell 2000 index of smaller-company stocks rose 5 points, or 0.4 percent, to 1,552.

The S&P 500 rallied Friday but lost 4.1 percent last week, its biggest decline in more than six months. It's fallen for three weeks in a row.

TECH FALLS AGAIN: The technology companies that have led the market higher in recent years, including some of the world's most valuable companies, continued to decline. Apple gave up 1.1 percent to $219.76 and software maker Adobe fell 2.5 percent to $242.59. Chipmaker Nvidia skidded 2.4 percent to $240.71.

The S&P 500 index of technology companies has dropped 7.2 percent since setting a record high on Oct. 3. The Nasdaq, which has a high concentration of tech stocks, is down 7.7 percent since late August.

Netflix, which will report its results Tuesday, lost 1.4 percent to $334.68. It's plunged 23 percent since it reported weak user growth three months ago.

SLOW LOANS: Bank of America's third-quarter profit and revenue were better than analysts expected, but Wall Street was disappointed with the company's loan growth. The company has emphasized responsible growth recently, and like other banks, it's benefiting from last year's corporate tax cut and rising interest rates. Its stock slid 2.7 percent to $27.69. Competitor Wells Fargo also reported weak loan growth on Friday.

D-FENSE: Defense contractors L3 Technologies and Harris Corp. said they will combine in an-all stock deal. The combined L3 Harris Technologies will have annual sales of around $16 billion this year, which would make it the sixth-largest U.S. defense contractor and one of the top 10 globally.

L3 gained 9.8 percent to $214.91 and Harris rose 8.5 percent to $167.96.

RETAIL WOBBLE: U.S. consumer spending edged up 0.1 percent in September, according to the Commerce Department. A rebound in car sales was canceled out by weak results elsewhere. Economists had projected a solid 0.6 percent rise in sales. Sales also grew just 0.1 percent in August, and the current stretch is the weakest two-month performance since the start of the year.

Retailers were mixed. Amazon fell 1.2 percent to $1,767.75 and Michael Kors fell 1.3 percent to $62.81, but Gap rose 1.8 percent to $27.14 and Dollar General picked up 1.9 percent to $106.74.

ENERGY: U.S. crude rose 0.4 percent to $71.62 a barrel in New York. Brent crude, the standard for international oil prices, added 0.2 percent to $80.63. Natural gas prices continued to surge as the weather in the U.S. grew colder. They rose 3.2 percent to $3.26 per 1,000 cubic feet and have climbed 8 percent in October to reach their highest price since January.

BONDS: Bond prices edged lower. The yield on the 10-year Treasury note rose to 3.16 percent from 3.14 percent late Friday.

Rising bond yields often lead to losses for high-dividend companies because many investors think of them as alternatives to bonds. That pattern hasn't held up in the last few days as investors have been looking for relatively safe picks on the stock market. On Monday, wireless infrastructure company American Tower rose 1.1 percent to $143.78 and power company Southern Co. added 2.1 percent to $44.48.

CURRENCIES: The dollar fell to 111.81 yen from 112.01 yen. The euro rose to $1.1586 from $1.1563.

OVERSEAS: France's CAC 40 added 0.1 percent while Britain's FTSE 100 rose 0.4 percent. Germany's DAX climbed 0.7 percent.

Japan's benchmark Nikkei 225 dipped 1.9 percent and the South Korean Kospi edged down 0.8 percent. Hong Kong's Hang Seng fell 1.5 percent.

Global stock indexes have been struggling this year as investors move money to the U.S. and out of Europe and Asia in response to faster economic growth in the U.S. and rising trade tensions. The losses the last few weeks for global markets have made it even worse.

The Hang Seng index in Hong Kong has fallen 22 percent since early January, meeting Wall Street's definition of a "bear market," or a decline of 20 percent form a recent peak. A number of other indexes have fallen at least 10 percent, known as a "correction." Those include the DAX and Kospi, which both peaked in late January, as well as the FTSE 100, the Ibex in Spain and the FTSE MIB in Italy, which peaked in May.


AP Markets Writer Marley Jay can be reached at http://twitter.com/MarleyJayAP

Disclaimer: This is unedited, unformatted feed from the Associated Press (AP) wire.

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