Manufacturing dip affects US shares
US stocks dipped in light volume yesterday as lingering concerns about a slowdown in growth more than offset gains in energy shares.
Investors kept trimming large-cap technology positions, pushing the tech-heavy Nasdaq Composite lower.
The S&P energy sector index rose 1.3 per cent, while its industrials index slipped 0.6 per cent, sending the market down for a second day. Sectors associated with cyclical growth have suffered recently, with industrials down more than 5 per cent so far this month.
“I don’t see any strong positive momentum,” said Kim Caughey Forrest, senior equity research analyst at Fort Pitt Capital Group in Pittsburgh.
The S&P 500 closed at its lowest level in over a month and ended below its 50-day moving average for a second straight day. The 50-day MA, now at 1,324.59, could turn into a hurdle for the benchmark to reestablish a strong uptrend.
Occidental Petroleum, rose 3.6 per cent to $102.50, while Joy Global fell 1.8 per cent to $85.96.
Following much weaker-than-expected New York and Philadelphia Fed manufacturing surveys last week, the Richmond Fed survey showed yesterday that manufacturing in the central Atlantic region stalled in May after expanding for seven months.
“We don’t really have jobs strengthening,” Forrest said.
Energy shares were helped by a near 2 per cent rise in US and Brent crude futures. Oil rallied after Goldman Sachs raised its forecast price for the commodity and as the euro erased some of the previous day’s losses.
The Dow Jones industrial average lost 25.05 points, or 0.20 per cent, to 12,356.21. The Standard & Poor’s 500 Index dropped 1.09 points, or 0.08 per cent, to 1,316.28. The Nasdaq Composite Index fell 12.74 points, or 0.46 per cent, to 2,746.16.
Gold miners’ stocks advanced as bullion rose to its highest in about three weeks on concerns about a spreading debt crisis in the Eurozone.
Freeport-McMoRan Copper & Gold gained 3 per cent to $48.82.
Volume was light, with roughly 6.6bn shares traded on the New York Stock Exchange, NYSE Amex and Nasdaq, below last year’s estimated daily average of 8.47bn.
Decliners outnumbered advancers on the NYSE by a ratio of about 8 to 7, while on the Nasdaq, about eight stocks fell for every five that rose.
Shares of Russian Internet company Yandex surged as much as 68 per cent in their debut.