Leading US stocks ended lower on Thursday as the vigil for a Fed chair speech began, but small- and mid-cap stocks managed to gain.
The S&P 500 index closed down 0.1% at 2,172 – the same level to the very integer where it was nestled at midsession.
Federal Reserve’s Jackson Hole symposium in Wyoming that began on Thursday, will garner even more attention on Friday when Janet Yellen, the Federal Reserve chair, is due to deliver a much-anticipated speech which could indicate the mood for raising US interest rates.
Her remarks will follow data which indicates the US economy may have perked up after a weak start to 2016. A report on Thursday showed durable goods orders, a proxy for investment, climbed more than expected in July. Yellen will speak at 1000 ET (1400 GMT) on Friday.
Conversely, the S&P Midcap 400 ended up 0.3% at 1,564 and the S&P Smallcap 600 up 0.3% at 754.
Meanwhile, the wider universe small-cap Russell 2000 index closed up 0.2% at 1,240.
Midsession
US top stocks were dragged down by the vigil for a Fed chair speech while small- and mid-caps gained at midsession on Thursday.
Federal Reserve’s Jackson Hole symposium that began on Thursday, will garner even more attention on Friday when Janet Yellen, the Federal Reserve chief, is due to deliver a much-anticipated speech.
Her remarks will follow data which indicates the US economy may have perked up after a weak start to 2016. A report on Thursday showed durable goods orders, a proxy for investment, climbed more than expected in July.
The S&P 500 was down 0.1% at 2,172 and led by two stocks who reported weak sales on Thursday, discount-store rivals Dollar General Corp (NYSE:DG) and Dollar Tree (NASDAQ:DLTR), down 15.7% to $77.37 and down 9.4% to $86.02, respectively.
Meanwhile, the S&P Midcap 400 was up 0.3% to 1,566 and led higher by Guess Inc (NYSE:GES), up 22.5% to $18.25. Trodden on Wednesday ahead of its earnings, those turned out better than expected and the shares reflected the mood.
The S&P Smallcap 600 was up 0.4% to 754 and led by Rex American Resources Corporation (NYSE:REX) up 8.6% to $80.39 after its second quarter earnings.
It was a Moon River moment for jeweller Tiffany & Co (NYSE:TIF), which reported its seven quarterly slide in sales in succession - but its shares were up 6.5% to $73.37 – the top gainer on the S&P 500.
Although Presidential candidate Hillary Clinton’s comments of Wednesday proposing to crack down on drug pricing had an adverse effect on pharma stocks that session, and it spilled over to London stocks on Thursday, they were not among the biggest fallers this session.
Open
Wall Street stumbled this morning in early Thursday trading, despite some encouraging figures from the Labor Department.
According to the recent jobs figures, slightly fewer people filed for US unemployment benefits last week. The total fell by 1,000 to a seasonally adjusted 261,000.
The Dow Jones industrial Average dropped almost 15 points this morning to 18,467.
McDonald’s Corp was the top winner, up 0.4% to US$115.3.
The biggest loser was Boeing down 0.45% to US$132.
The wider S&P 500 index fell almost 2 points to 2,174.
Nasdaq opened 7.5 points lower at 5,210.
The top winner was Nymox Pharmaceutical Corp, up almost 16% to US$5.15.
The biggest loser was Amedica Corporation down almost 11% to US$1.
Oil companies led the downward slide, with Exxon Mobil down 0.47% and Chevron down 0.39%.
Jackson Hole
All eyes are on Jackson Hole – a town in Wyoming that annually hosts a Federal Reserve policy symposium - where Fed chair Janet Yellen is scheduled to speak tomorrow.
“Yellen’s speech at Jackson Hole tomorrow remains the headline act this week and prior to that I expect traders to proceed with caution,” said Craig Erlam, analyst at Oanda.
“This event has often been used to warn about upcoming policy changes and whether that is the next hike or a more dovish Fed, we’ll have to wait and see.”
That said, Erlam added that he wouldn’t be surprised if the event turned out to be an anti-climax should Yellen “once again keeps her cards very close to her chest.”
Hillary spooks pharma
Whilst markets are more vaguely unsettled at the uncertainties posed by Donald Trump potentially becoming ‘leader of the Free World’, Hillary Clinton’s quite specific new comments have spooked investors in drug stocks.
Clinton, amid stateside controversy over perceived over charging for drug treatments, publicly called on Mylan to reduce the price of its EpiPen treatment for severe allergies which is said to have increased by more than 400% in the past decade.
The Democrat has already said on the campaign trail that she would ‘fight’ pharmaceutical companies as a pledge to help lower costs for consumers.
“Hillary Clinton’s attack on the price gauging of an allergy medicine is expected to continue to weigh on the healthcare sector,” said Jasper Lawler, analyst at CMC Markets.
He added: “Her statements reaffirm a fear in the industry that a Clinton presidency would see a serious crackdown on pharmaceutical price gauging.”
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