Investors also refrained from stepping up dollar purchases ahead of Fed chief Janet Yellen’s speech at a closely watched symposium in Jackson Hole, Wyoming, on Friday, market sources said.
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Overall trading activity on Monday may be somewhat subdued, however, as a relatively quiet news day may keep some traders on the sidelines.
Both economists said they would be listening carefully on Friday to see how comfortable Yellen is with the economic outlook.
The Dow Jones industrial average fell 23.15 points, or 0.12 percent, to 18,529.42, the S&P 500 lost 1.23 points, or 0.06 percent, to 2,182.64 and the Nasdaq Composite added 6.23 points, or 0.12 percent, to 5,244.60.
Although speeches last week from Fed Presidents John Williams, William Dudley and Dennis Lockhart all indicated a possible rate hike by September, futures markets are only pricing a 12% likelihood for a hike next month and less than 50% chance for December.
The weaker yen helped Japan’s Nikkei stock index to end 0.3 percent higher, while Hong Kong added 0.3 percent although other markets struggled.
The dollar rose 0.2% against the Japanese yen to ¥100.40.
Maybe, or better said “hopefully”, Fed Chair Janet Yellen’s Jackson Hole speech on Friday will make us a little bit wiser about how she, which implies of course the FMOC, sees the USA economy as well as the PCE, or price index for personal consumption expenditures, over the short to median term.
Biotech stocks received a boost from Pfizer’s $US14 billion acquisition of cancer drug maker Medivation, which jumped almost 20 per cent. The S&P 500 fell 3.15 points, or 0.1 percent, to 2,183.87. Palladium was 2.82 percent lower at $688.
The dollar was trading at 100.59 yen in early Tokyo trade, up from 100.20 yen in NY.
Asian stocks swung between gains and losses as energy producers declined after crude oil futures slumped and investors weighed the chances of higher USA interest rates this year.
The kiwi dollar rose around a third of a cent to $US0.7310 in reaction. Perhaps, the recent recovery in the oil patch fueled hopes of stronger inflation in the coming days (read: Oil Again in Bull Market: 4 Country ETF Winners).
Oil prices sank more than one percent after last week’s rally after Iraq said at the weekend that it intends to increase shipments, according to Bloomberg News, while U.S. firms again increased their rig count.
However, it would pick up in the medium term as energy prices recover from their rock-bottom levels and the labor market gains more traction.
Brent crude futures were trading at $49.94 per barrel at 0712 GMT, down 95 cents, or 1.87 per cent.
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Last Friday, the greenback stayed broadly higher against the other major currencies. While one group views the US economy as sturdy enough to digest a rate hike, the other seeks further evidence of economic well-being.
