By Chuck Mikolajczak
| NEW YORK
NEW YORK U.S. stocks erased early gains and turned negative on Friday after the head of the FBI said it will review more emails related to Democratic presidential candidate Hillary Clinton's private email use. Each of the three major indexes on Wall Street fell to session lows after FBI Director James Comey said in a letter to several congressional Republicans that the agency had learned of the existence of emails that appeared to be pertinent to its investigation. The election is scheduled to take place in 11 days, on Nov. 8."The market turned south the minute the headline hit the tape that the FBI is all of a sudden looking at (Hillary Clinton’s) emails again," said Ken Polcari, Director of the NYSE floor division at O’Neil Securities in New York. "The fact they are looking again just raises the prospect that once again they might find something, so the market turned south because it is expecting a Clinton win." Wall Street had been higher for most of the session after economic data showed the U.S. economy grew 2.9 percent in the third quarter, its fastest pace in two years, and upbeat earnings from Google parent company Alphabet Inc (GOOGL.O).Alphabet shares were up 0.6 percent at $821.85.
While the report supports the case for an interest rate hike, the Federal Reserve is unlikely to make a move at its meeting next week, as it falls just days ahead of the U.S. presidential election.The market is largely expecting the central bank to hike rates in December, with the odds of a rate increase that month at 73.6 percent, according to the CME Group's FedWatch tool. Investors also digested the latest wave of earnings reports with the hope the latest quarter snaps a year-long earnings recession. Nearly 73 percent of the S&P 500 companies that reported have topped Wall Street expectations, with growth for the quarter now expected to be 3 percent, according to Thomson Reuters I/B/E/S. The quarter had been expected to show a decline of 0.5 percent at the start of October.
On the negative side, Amazon.com (AMZN.O) was set for its worst day in nearly nine months, falling 4.8 percent to $778.74 after the online retailer warned that heavy investments in the crucial holiday quarter would hurt profits. The stock was the top drag on the S&P and the Nasdaq.The Dow Jones industrial average .DJI fell 37.49 points, or 0.21 percent, to 18,132.19, the S&P 500 .SPX lost 9.81 points, or 0.46 percent, to 2,123.23 and the Nasdaq Composite .IXIC dropped 29.05 points, or 0.56 percent, to 5,186.93.Each of the major indexes were poised to post a decline for the week.
Amgen (AMGN.O) plunged 10.1 percent to $144.30 after the world's largest biotechnology company's sales for its flagship drug disappointed investors and analysts. Declining issues outnumbered advancing ones on the NYSE by a 1.65-to-1 ratio; on Nasdaq, a 1.37-to-1 ratio favored decliners.The S&P 500 posted 10 new 52-week highs and 9 new lows; the Nasdaq Composite recorded 42 new highs and 112 new lows. (Reporting by Chuck Mikolajczak; Editing by Nick Zieminski)
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Updated Date: Oct 29, 2016 02:00 AM