U.S. stocks fluctuate near record levels amid economic reports

NEW YORK – U.S. stocks fluctuated, with benchmark indexes near all-time highs, as investors assessed data on labor, manufacturing and housing to gauge the strength of the American economy.

The Standard & Poor’s 500 Index rose less than 0.1 percent to 2,068.54 at 10:18 a.m. in New York. The Dow Jones Industrial Average fell 13.13 points, or less than 0.1 percent, to 17,801.81. The Nasdaq 100 Index climbed 0.3 percent. Trading in S&P 500 companies was 29 percent below the 30-day average for this time of the day. U.S. markets will be closed tomorrow for the Thanksgiving holiday.

“The data this morning isn’t great,” Michael James, a Los Angeles-based managing director of equity trading at Wedbush Securities Inc., said in a phone interview. “You might see a pullback because we’re relatively overextended on a short-term basis, but outside some big macro shock to the downside, I don’t see the market pulling back that much.”

Orders for U.S. business equipment such as machinery and electrical gear unexpectedly declined in October. Other data showed jobless claims increased by 21,000 to 313,000 in the week ended Nov. 22, the highest since early September, from 292,000 in the prior period. New homes in the U.S. sold at a slower pace than forecast last month.

- Advertisement -

Consumer confidence climbed to a more than seven-year high in November as Americans’ views of their financial well-being improved heading into the holiday shopping season. A separate report showed consumer spending climbed in October at the same pace as incomes, showing households are staying within their means as the holiday-shopping season begins.

Economic growth

Investors are watching U.S. data to gauge whether the world’s largest economy can lead a rebound in global growth. A report yesterday showed U.S. gross domestic product expanded at a 3.9 percent annualized rate in the third quarter, more than initially estimated.

The S&P 500 has advanced each December for the past six years. It is up 11 percent from its low last month, closing at a third straight record on Nov. 24 and heading for a second monthly gain, as data signaled the U.S. economy is improving and central banks in Europe, Japan and China added more stimulus measures.

High valuations

The rally in American equities has pushed stock valuations to near the highest levels since 2009. The S&P 500 trades at 17.2 times the projected earnings of its members, up from a multiple of 15.5 last month. Profit for S&P 500 companies may rise 7.6 percent this year, estimates compiled by Bloomberg show.

Calm has returned to equity markets. The Chicago Board Options Exchange Volatility Index, the gauge of options prices known as the VIX, has dropped 12 percent in the past four days to a two-month low. The benchmark gauge of price swings surged to a more than two-year high on Oct. 15.

Six out of 10 main industries in the S&P 500 increased today, with phone and technology companies posting the largest gains. Energy shares slumped the most, dropping 0.6 percent ahead of tomorrow’s OPEC meeting.

Chipmakers led gains in the S&P 500. Analog Devices Inc., a maker of semiconductors, gained 4 percent after profit and sales for the fourth quarter exceeded projections. The company’s adjusted gross margin, a measure of profitability, was also wider than analysts had predicted.

Hewlett-Packard Co. added 2.7 percent even after the computer maker reported fourth-quarter sales that missed estimates.

Deere & Co. dropped 2.8 percent. The world’s largest maker of farm equipment forecast 2015 profit that trailed estimates as farmers buy fewer high-horsepower tractors and combines after crop prices fell. Caterpillar Inc. slumped 0.5 percent.

No posts to display