Sun, May 14, 2017 - Page 14 News List

Weak US data weigh on Wall Street

‘CONCERNING’:Americans do not seem to be spending, despite employment and income numbers being good, the senior vice president of Wedbush Securities said

Reuters, NEW YORK

A trader works on the floor of the New York Stock Exchange on Friday.

Photo: Bloomberg

Wall Street slipped on Friday, ending the week lower as tepid economic data weighed on banks and worries deepened over Nordstrom Inc and other department stores.

Risk-averse sentiment gripped Wall Street this week after US President Donald Trump unexpectedly fired his FBI chief, the potential fallout from which could delay Trump’s pro-growth goals to cut taxes and boost spending on infrastructure.

Soft retail sales and monthly inflation data on Friday raised concerns about slow economic growth and questions about whether the US Federal Reserve could maintain its hawkish outlook for interest rates this year.

Federal funds futures implied a 49 percent chance of two more rate hikes this year, compared with 54 percent shortly before the release of the data, CME Group’s FedWatch tool showed.

Banks, which typically benefit from higher interest rates, dragged on the S&P 500 and Dow Jones Industrial Average. The S&P 500 financial sector fell 0.45 percent, while industrials were off 0.65 percent.

Department stores faced serious pressure for a second straight day after JC Penney Co reported lower-than-expected comparable-store sales, sending its shares down 13.99 percent.

Nordstrom dropped 10.84 percent after weak quarterly same-store sales.

Macy’s Inc fell 3.04 percent, bringing its loss to more than 19 percent in the past two sessions following its dismal quarterly report.

The less-than-expected 0.4 percent monthly increase in last month’s retail sales stirred fears about the retail sector as well as the US economy.

“The numbers were light again, people don’t seem to be spending money, despite employment and income numbers being good. It’s concerning,” San Francisco-based Wedbush Securities senior vice president Stephen Massocca said.

The Dow Jones Industrial Average declined 0.11 percent to end at 20,896.61 points and the S&P 500 lost 0.15 percent to 2,390.90.

The NASDAQ Composite added 0.09 percent to 6,121.23.

For the week, the Dow fell 0.5 percent, the S&P 500 lost 0.4 percent and the NASDAQ rose 0.3 percent.

With a better-than-expected first-quarter reporting season all but complete, S&P 500 companies on average are predicted by analysts to grow their second-quarter earnings by 8.3 percent, according to Thomson Reuters I/B/E/S.

The S&P 500 is trading at 17.6 times expected earnings, higher than its 10-year average of 14.2.

General Electric Co was the top percentage loser on the Dow, down 2.08 percent after Deutsche Bank AG downgraded its shares from “hold” to “sell.”

Declining issues outnumbered advancing ones on the New York Stock Exchange by a 1.32-to-1 ratio; on NASDAQ, a 1.39-to-1 ratio favored decliners.

The S&P 500 posted 28 new 52-week highs and 11 new lows; the NASDAQ Composite recorded 82 new highs and 70 new lows.

About 6.1 billion shares changed hands on U.S. exchanges, below the daily average of 6.8 billion shares over the past 20 sessions.

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