Despite the downbeat economic data, the market spent much of the day hovering just below its all-time highs. “It seems stocks are a better long-term investment at this point”.
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Sheng Laiyun, the spokesman for the National Bureau of Statistics, has tried to reassure markets, saying the trend is good and the economy is making steady progress despite the weak economic indicators for July, which were affected by summer flooding and other one-time factors.
Almost all ten of the S&P 500’s main sectors finished in positive territory.
Nordstrom rose 6.4 per cent in the run-up to the results after market closes, while J.C. Penney, which reports on Friday, was up 8 per cent. “That should at least support the commodity price”.
OIL PRICES: Benchmark U.S. crude was up 55 cents, or 1.3 percent, at $44.04 a barrel in NY.
Brent crude which is used to price global oils was down by 2.1% or 93 cents to $44.05 per barrel in London.
Non-commodity shares also rose briskly, with consumer discretionary stocks adding 1%. Natural gas gained 3 cents to $2.58 per 1,000 cubic feet.
The rally in stocks in the late-1990s is often viewed as a case study for how stocks can shoot up even after reaching new highs, analysts also expects traders to be cautious as these stock indices are already at record highs.
The Dow Jones industrial average is down 40 points, or 0.2 percent, to 18,573. Contracts on the Kospi index in Seoul added 0.1 percent, while FTSE China A50 Index futures were down 0.2 percent. On the Nasdaq, 1,624 issues rose and 972 fell.
Beating its previous record high from last Friday, the S&P 500 is priced at about 17 times expected earnings, compared with a 10-year average of 14 times expected earnings, according to Thomson Reuters data. Energy producers posted the steepest declines, slipping 1.4 percent amid crude’s slide. India’s Sensex gained 1 precent to 28,125.90 and markets in Southeast Asia were mostly higher.
Gold and other precious metals declined. Silver lost 32 cents, or 1.6 percent, to $19.70 an ounce.
In the fixed income market, the yield on the 10-year Treasury note was down to 1.484% from a close of 1.57% Thursday.
CURRENCIES: The dollar strengthened to 102.04 yen from 101.86 on Thursday. The stock added 65 cents, or 6.5 percent, to $10.59.
NOT IN STYLE: Michael Kors slid 1.8% after the clothing company forecast weaker sales for the current quarter and lowered its outlook for sales at established stores. Its shares slid 48 cents to $9.71.
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“We’re continuing to grind higher”, said Stephen Carl, principal and head equity trader at Williams Capital Group LP in NY.
