Stocks Edge Up as Investors Parse Trade Headlines
December 05 2019 - 5:16PM
Dow Jones News
By Karen Langley and Paul J. Davies
U.S. stocks edged higher Thursday as investors parsed the latest
headlines on the trade dispute with China and looked ahead to
Friday's jobs report.
It was a subdued trading day, with major indexes inching
downward in the morning before recovering to close the session in
positive territory.
The S&P 500 rose 4.67 points, or 0.2%, to 3117.43, while the
Dow Jones Industrial Average gained 28.01 points, or 0.1%, to
27677.79. The Nasdaq Composite inched up 4.03 points, or less than
0.1%, to 8570.70.
Trade-related news has driven markets this week. China again
offered reassurance Thursday on the state of trade talks between
the world's two largest economies, with a spokesman for China's
Commerce Ministry saying the negotiating teams have maintained
close communications.
That followed comments from President Trump who had suggested
earlier in the week that the talks could continue well into next
year, spooking investors and pushing major indexes lower. Mr. Trump
later said the talks were going "very well."
Investors have been watching the negotiations particularly
closely with the approach of the next wave of proposed tariff
increases, which are due to go into effect Dec. 15.
"I think you'll see more volatility around trade war coming up
as this December 15 deadline looms," said Sandy Villere, portfolio
manager at the Villere Balanced Fund.
Mr. Villere said he has watched trade-related market drops for
opportunities to buy particular stocks whose prices have been
pushed down. He said his fund added shares of ON Semiconductor
earlier this year.
Although major U.S. stock indexes have declined so far this
week, they have posted double-digit gains for the year. The S&P
500 has climbed 24% in 2019.
Sébastien Galy, senior macro strategist at Nordea Asset
Management, speculated that by the end of next week, "Trump will be
willing to say that tariff increases are unnecessary because talks
have progressed."
Meanwhile, fresh economic data Thursday showed the number of
Americans applying for first-time unemployment benefits fell last
week, missing expectations of economists surveyed by The Wall
Street Journal.
Investors will closely watch Friday's nonfarm payrolls data for
additional insights into the health of the U.S. jobs market. The
employment figures could turn weaker given the slowdown in
corporate investment spending and the weakening in new job openings
reported earlier this week.
"It's possible we start to see an easing in the jobs market,"
Mr. Galy said.
As broad stock indexes showed muted moves, earnings reports
drove swings in individual stocks. Shares of fashion retailer
Express jumped $1.09, or 28%, to $5 after it reported third-quarter
sales that beat expectations. Shares of Five Below rose $5.61, or
4.8%, to $123.67 after the discount retailer beat estimates for the
third quarter.
Shares of RH, formerly known as Restoration Hardware, leapt
$27.55, or 13%, to $233.17, a new record, after the
luxury-furniture retailer issued a bullish forecast around a
planned international expansion.
And Michaels shares fell $1.13, or 16%, to $6.08 after the
crafts retailer reported a drop in profit. Shares of Brown-Forman
fell $4.27, or 6.3%, to $63.57 after the maker of Jack Daniel's
whiskey lowered its guidance.
Among the sectors in the S&P 500, materials, technology and
communications services led the way, while shares of energy,
consumer-discretionary and consumer-staples companies lost
ground.
In Asia, the Hang Seng Index gained 0.6%, while the Shanghai
Composite rose 0.7%. The Stoxx Europe 600 fell 0.1%.
The yield on the benchmark 10-year Treasury note rose to 1.795%,
from 1.781% Wednesday.
Write to Karen Langley at karen.langley@wsj.com and Paul J.
Davies at paul.davies@wsj.com
(END) Dow Jones Newswires
December 05, 2019 17:01 ET (22:01 GMT)
Copyright (c) 2019 Dow Jones & Company, Inc.