BackUS stocks little changed after 3-day retreat before data
The S&P 500 dropped 1.4% during a 3-day losing streak, its sixth this year, after closing 18 September at a record
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London/New York: US stocks were little changed, after a three-day slump for the Standard & Poor’s 500 Index, as investors awaited data estimated to show new-home sales rebounded for the first time in three months.
The S&P 500 fell 0.1% to 1,980.93 at 9:46 am in New York. The Dow Jones Industrial Average lost 2.99 points, or less than 0.1%, to 17,052.88 on Wednesday.
“We’ve barely seen many corrections that extended more than two days at a time," Jasper Lawler, a London-based market analyst at CMC Markets Plc, said by telephone. “We saw a couple days of declines and people are going into the default of buying into that dip on US markets. I could see us pushing into new highs. The Fed has said they’re going to be easy for a considerable period of time, so that’s still generally supportive of stocks."
The S&P 500 dropped 1.4% during a three-day losing streak, its sixth this year, after closing 18 September at a record. The gauge has not fallen four straight days since December.
The index rallied last week as the Federal Reserve retained assurances that its benchmark interest rate will stay low for a “considerable time" after the central bank ends a bond- purchase programme intended to spur growth.
Volatility across stocks, bonds and currencies worldwide is close to record or multi-year lows, even after Fed chair Janet Yellen cautioned last week that the central bank could pull forward the timing of a rate increase if US economic performance continues to exceed expectations.
A Commerce Department report at 10 am in Washington may show new-home sales rebounded in August to a 430,000 annualized pace following two months of declines, according to economists’ estimates in a Bloomberg survey.
Small-cap and Internet shares led the recent decline in US equities, as investors sell speculative shares. The Dow Jones Internet Composite Index fell 2.1% in the past two days, while the Russell 2000 Index lost 3.5% in three days, leaving it 5.2% below a high on 2 September.
“Some areas of the market got very oversold, so it’s not surprising to see a bounce," Walter Todd, who oversees about $1 billion as chief investment officer for Greenwood, South Carolina-based Greenwood Capital Associates LLC, said in a phone interview. “Investors are a little nervous right now given the backdrop, but the economy continues to be in good shape." Bloomberg
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