S&P 500 inches higher on trade, vaccine developments

By Stephen Culp NEW YORK (Reuters) - The S&P 500 edged higher on Tuesday, with a drop in Apple stock capping gains from positive developments in U.S.-China trade and fresh progress in the medical battle against the coronavirus pandemic. The S&P 500 and the Nasdaq were up modestly, on track to close at record highs.

Reuters August 26, 2020 00:06:59 IST
S&P 500 inches higher on trade, vaccine developments

SP 500 inches higher on trade vaccine developments

By Stephen Culp

NEW YORK (Reuters) - The S&P 500 edged higher on Tuesday, with a drop in Apple stock capping gains from positive developments in U.S.-China trade and fresh progress in the medical battle against the coronavirus pandemic.

The S&P 500 and the Nasdaq were up modestly, on track to close at record highs. But the Dow, which has yet to reclaim its February high, was firmly in the red.

"The market's struggling," said Paul Nolte, portfolio manager at Kingsview Asset Management in Chicago. "Investors are done with the earnings season and they're staring at the upcoming election wondering what's next."

"We're looking at a market that's richly valued that investors are starting to think about rebalancing a bit."

Apple Inc weighed heaviest on all three indexes, its stock retreating 1.6% days ahead of its 4-to-1 stock split.

That split, which will reduce Apple's weight in the Dow, prompted a reshuffle in the blue-chip industrial average, with Salesforce.com replacing Exxon Mobil Corp , Amgen Inc taking Pfizer Inc's spot, and Raytheon Technologies Corp ousted by Honeywell International Inc .

Salesforce.com, Amgen and Honeywell shares were up between about 3% and 5%.

Trade officials in Washington and Beijing reaffirmed their commitment to Phase One of a bilateral trade deal, but goodwill between the countries soured as China called a U.S. spy plane's flight through a no-fly zone a "naked provocation."

British drugmaker AstraZeneca has begun trials of its antibody-based drug for the treatment and prevention of COVID-19 , the latest development in a global race to combat the pandemic.

Later in the week the Kansas City Fed will convene its virtual Jackson Hole Economic Policy Symposium, with U.S. Federal Reserve Chairman Jerome Powell expected to speak.

On the economics front, the Conference Board's Consumer Confidence index plunged to a 6-year low this month, while a report from the Commerce Department showed sales of new homes in July surged to a more than 13-1/2-year high.

The Dow Jones Industrial Average <.DJI> fell 127.58 points, or 0.45%, to 28,180.88, the S&P 500 <.SPX> gained 3.59 points, or 0.10%, to 3,434.87 and the Nasdaq Composite <.IXIC> added 40.43 points, or 0.36%, to 11,420.15.

Of the 11 major sectors in the S&P 500, four were in positive territory, with communications services <.SPLRCL> enjoying the largest percentage gain.

American Airlines Group Inc dropped 2.8% after announcing it would layoff 19,000 employees in October unless the government extends airline payroll aid.

Electronics chain Best Buy Inc beat analysts' second-quarter sales expectations but warned of a current quarter slowdown following the work-from-home demand surge. Its shares were off 4.6%.

Medtronic rose 2.8% after the medical device maker's quarterly profit beat consensus. The company said a revival in elective surgeries was boosting demand.

Salesforce.com is expected to post results after the bell.

Declining issues outnumbered advancing ones on the NYSE by a 1.45-to-1 ratio; on Nasdaq, a 1.07-to-1 ratio favored advancers.

The S&P 500 posted 27 new 52-week highs and no new lows; the Nasdaq Composite recorded 54 new highs and 22 new lows.

(Reporting by Stephen Culp)

This story has not been edited by Firstpost staff and is generated by auto-feed.

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