By Yashaswini Swamynathan and Tanya Agrawal
U.S. stocks pared gains in early afternoon trading on Tuesday as a fall in oil prices dragged down energy shares.The Dow Jones Industrial Average and the Nasdaq Composite hit all-time highs just after the market opened, with the S&P 500 coming within spitting distance of yet another record high.Oil prices were pressured by sluggish demand and evidence of a burgeoning revival in U.S. shale production that could complicate efforts by OPEC and other producers to reduce a supply glut.The energy index .SPNY fell 1.7 percent, leading the decliners. Chevron's (CVX.N) 1.3 percent fall and Exxon's (XOM.N) 1 percent drop weighed the most on the S&P and the Dow.Markets have rallied sharply after Trump's election victory in November, riding on hopes that his plans including simpler regulations, higher infrastructure spending and tax cuts will boost the economy.However, the lack of details regarding economic policies and Trump's focus on isolationist policies, including a travel ban on seven mainly Muslim nations, have also made investors cautious.With the earnings season at its peak, stock valuations are in focus given the run-up in shares. The S&P 500 is trading at 17.7 times forward 12-month earnings, above the 10-year median of 14.7 times, according to StarMine data.
Fourth-quarter earnings of S&P 500 companies are estimated to have risen 8.2 percent - the best in nine quarters."We've been getting some back and forth between the new administration's business-friendly policies versus the disruptions economically and politically from the immigration and trade-related issues," said Jason Pride, director of investment strategy at Glenmede in Philadelphia."However, at the end of the day, the expansion is continuing, the economy and earnings are growing and that should support equities."A report from the U.S. Commerce Department showed trade deficit fell more than expected in December as exports rose to their highest level in more than 1-1/2 years, outpacing an increase in imports.
At 12:37 p.m. ET (1737 GMT) the Dow Jones industrial average .DJI was up 40.94 points, or 0.2 percent, at 20,093.36.The S&P 500 .SPX was up 0.46 points, or 0.02 percent, at 2,293.02 and the Nasdaq Composite .IXIC was up 9.87 points, or 0.17 percent, at 5,673.42.Shares of Michael Kors (KORS.N) dropped as much as 15.4 percent to a more than one-year low of $34.92, after the handbag maker cut its full-year revenue forecast.
Health insurer Centene (CNC.N) was up 5.7 percent at $67.25 following better-than-expected quarterly revenue and profit.General Motors (GM.N) slipped 4.8 percent to $35.04 after the automaker said fourth-quarter net income fell partly because of $500 million in foreign exchange losses. The stock was among the biggest drags on the S&P.Twenty-First Century Fox (FOXA.O) fell 1.5 percent to $30.61 after its quarterly revenue missed Wall Street expectations.Declining issues outnumbered advancers on the NYSE by 1,624 to 1,201. On the Nasdaq, 1,614 issues fell and 1,127 advanced.The S&P 500 index showed 27 new 52-week highs and three new lows, while the Nasdaq recorded 83 new highs and 29 new lows. (Reporting by Yashaswini Swamynathan and Tanya Agrawal in Bengaluru; Editing by Anil D'Silva)
This story has not been edited by Firstpost staff and is generated by auto-feed.
Published Date: Feb 08, 2017 12:00 am | Updated Date: Feb 08, 2017 12:00 am