Wednesday 1st March 2017 |
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Wall Street weakened from record highs as investors focused on US President Donald Trump’s address to Congress later in the day to assess if bets on his broad policy promises are justified.
“While markets no doubt appear to like what they are hearing, the president now needs to deliver,” Michael Hewson, chief market analyst at CMC Markets in London, wrote in a note, Bloomberg reported. “If he fails to do so, we could well see a swift market reaction.”
In 1.09pm trading in New York, the Dow Jones Industrial Average fell 0.1 percent, while the Nasdaq Composite Index dropped 0.6 percent. In 12.54pm trading, the Standard & Poor’s 500 Index declined 0.3 percent.
The US dollar also moved lower, while Treasuries gained, pushing the yield on the 10-year benchmark note one basis point lower to 2.35 percent.
"What we're looking for tonight is just more meat on those bones," Mark Spellman, portfolio manager at Alpine Funds in Purchase, New York, told Reuters. "We've gotten these generalities and we're trying to figure out how things are going to be constructed."
The Dow weakened as slides in shares of Wal-Mart and those of Intel, recently down 1.5 percent and 1 percent respectively, outweighed gains in shares of Boeing and those of Coca-Cola, up 0.8 percent and 0.7 percent respectively.
Shares of Target sank, trading 12.3 percent lower as of 1.12pm in New York, after the retailer missed the mark with its full-year profit forecast and unexpectedly announced plans to lower its prices.
“Our fourth quarter results reflect the impact of rapidly-changing consumer behaviour, which drove very strong digital growth but unexpected softness in our stores,” Brian Cornell, CEO of Target, said in a statement. “We will invest in lower gross margins to ensure we are clearly and competitively priced every day.”
“While the transition to this new model will present headwinds to our sales and profit performance in the short term, we are confident that these changes will best-position Target for continued success over the long term,” Cornell noted.
Investors weren't so sure and Target’s results weighed on the industry.
"It's that drum beat of bad retail news of the big-box retailers," Mark Spellman, portfolio manager at Alpine Funds in Purchase, New York, told Reuters. “So in case you thought maybe that was over, Target certainly reminded us all that it didn’t.”
Bucking the trend, shares of Priceline jumped, up 6.3 percent as of 1.19pm, after the company posted quarterly results that beat expectations.
The company reported “accelerating growth in hotel room nights booked, with solid organic growth and attractive profit margins," Priceline CEO Glenn Fogel said in a statement. "We also recorded accelerating growth in room nights booked for the full year 2016 over 2015."
In Europe, the Stoxx 600 Index ended the day with a gain of 0.2 percent from the previous close.The UK’s FTSE 100 Index gained 0.1 percent, as did Germany’s DAX Index, while France’s CAC 40 Index increased 0.3 percent.
BusinessDesk.co.nz
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