Wednesday's Stock Market Close: Retail Sales Pull Stocks Lower
U.S. stocks fell Wednesday on a sour retail sales report as investors turned their focus away from corporate earnings and toward other issues.
The Dow Jones Industrial Average lost 22 points to 27,001 while the Nasdaq composite trimmed 24 points to 8,124 and the S&P 500 gave up 6 points to 2,989.
Volume on the New York Stock Exchange totaled 2.5 billion shares with 1,531 issues advancing and 1,415 declining. One-hundred six stocks climbed to new highs and 33 fell to new lows.
Leading the most actives were Bank of America ( BAC ) , General Electric (GE) and Achillion Pharmaceuticals (ACHN).
Retail sales dropped unexpectedly in September, the first time since February. Overall, sales were off 0.3% from August, the Commerce Department reported. Sales fell to $525.6 billion. The drop fueled expectations for an interest rate cut when the Federal Open Markets Committee meets at the end of the month.
On the good news front, the United Autoworkers announced a tentative agreement with General Motors (GM) to end the month-old strike that has cost the automaker more than $1.5 billion. The strike affected 48,000 workers. The UAW National Council votes on the pact Thursday and if approved, will submit it to the rank-and-file.
Bank of America reported a third-quarter profit of $5.78 billion or 56 cents a share, compared with $7.17 billion or 54 cents a share in the year ago quarter. Profits were trimmed by a $2.1 billion charge related to the pending dissolution of a payment-processing partnership with First Data Corp.
Hopes for an agreement before the Oct. 31 British exit from the European Union dwindled as uncertainty grew over whether Northern Ireland’s Democratic Unionist Party would accept a compromise. The main sticking point in an agreement concerns the border between the North and the Republic of Ireland. British Prime Minister Boris Johnson has long rejected the so-called backstop that essentially would have left Northern Ireland in the euro customs zone. The latest proposal involves drawing a regulatory and customs border in the Irish sea.
Though Johnson has said he’s against extending the Oct. 31 Brexit deadline, the Guardian reported an extension may be required to work out a smooth separation.
China meanwhile warned of “strong countermeasures” following U.S. House passage on unanimous voice votes of legislation backing pro-democracy demonstrators in Hong Kong. A spokesman for China’s Ministry of Foreign Affairs warned U.S. lawmakers to stop meddling in China’s internal affairs but stopped short of spelling out retaliatory actions.
The U.S. and China already are embroiled in a trade war.
Global markets were mixed. In Asia, Hong Kong’s Hang Seng closed up 0.61% while Japan’s Nikkei 225 rose 1.2% but the China Shanghai Composite was off 0.41%. Australia’s S&P/ASX added 1.27%.
In Europe, the London FTSE 100 closed off 0.61% while the German DAX pushed 0.32% higher and the French CAC 40 dipped 0.09%. The Stoxx Europe 600 was off 0.05%.
On currency markets, the British pound added 0.41 cent to $1.2825 and the euro was up 0.42 cent at $1.1074.
Oil futures were higher. Crude oil gained 50 cents to $53.31 while Brent crude lost 8 cents $59.34. Gold futures were up $10.30 to $1,493.70 an ounce while silver added 3 cents to $17.41 an ounce.
The 10-year and 30-year Treasury notes both added 2/32, with the yields falling to 1.748% and 2.232%, respectively.
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