Sept 10 (Askume) – Wall Street’s benchmark S&P 500 closed 0.5% higher on Tuesday, but gains were limited by concerns about slowing economic growth and after the Dow Jones warned of weakness in the quarter following losses in bank stocks.
The energy (.SPNY) benchmark was the biggest faller among 11 industry indexes , losing 1.9%, as crude oil futures tumbled after OPEC+ cut its demand forecasts for 2024 and 2025.
Bank stocks fell broadly after Goldman Sachs (GS.N) Chief Executive David Solomon said late on Monday that trading revenue could fall as much as 10% this quarter. JPMorgan Chase & Co (JPM.N) earnings on Tuesday fell short of expectations on interest payments.
Separately, the financial chief of small consumer lender Ally Financial (ALLY.N) said lending challenges had increased this quarter , sending shares down 17.6%.
The bank’s warning overshadowed news that the Federal Reserve’s supervisory chief announced plans to substantially ease conditions for big banks to raise capital.
“Many of the moves today were driven by concerns that banks were lowering their earnings estimates for the quarter,” said Lindsey Bell, chief strategist at 248 Ventures in Charlotte, North Carolina. “The news from JPMorgan, Goldman Sachs and Everi all caught our attention because they basically said their business was slowing down.”
In addition to uncertainty over the Fed’s interest rate decision next week and its comments on the economy, investors are concerned about the impact of weak energy demand on the economy. In addition, the US presidential election will be held on November 5 .
“We are seeing signs that economic growth is slowing around the world, which is even more worrying given the uncertainty created by the election cycle,” Bell said.
Democratic presidential candidate Kamala Harris and Republican candidate Donald Trump on TuesdayThey will meet for the first time at 9 p.m. ET (0100GMT), with election uncertainty taking center stage.
“We’re focused on three things today: growth concerns, lower trade and tonight’s presidential debate,” said John Augustine, chief investment officer at Huntington National Bank.
But Augustine questioned investors’ ability to apply JPMorgan’s news to the “whole economy.”
The Dow Jones Industrial Average (.DJI) fell 92.63 points, or 0.23%, to 40,736.96; the S&P 500 Index (.SPX) rose 24.47 points, or 0.45%, to 5,495.52, the IX rose 141.28 points, or 0.48%, to 17,025.88.
Wall Street’s main stock indexes rose more than 1% in the previous session as investors started buying on dips after last week’s sharp losses.
Investors will be closely watching Wednesday’s August CPI inflation report and Thursday’s producer price report.
The S&P 500 Financials Index (.SPSY) is the benchmark index’s second-weakest sector, falling 1% on Tuesday, its biggest index point to date. The biggest decliners were JPMorgan Chase (JPM.N), which fell 5.2%, and Goldman Sachs (GS.N), which fell 4.3%.
Among other stocks, Hewlett Packard Enterprise (HPE.N), which was the biggest decliner on the S&P 500 on Tuesday, fell after it agreed to acquire Juniper Networks (JNPR.N) for $1.35 billion .Shares fell 8.5%.
However, shares of software company Oracle (ORCL.N) rose 11.4% to become the S&P 500’s biggest gainer.The quarterly results were better than expected.
Advancing issues on the NYSE outnumbered declining ones by a 1.15-to-1 ratio, with 390 stocks hitting new highs and 159 hitting new lows.
On the Nasdaq, 2,130 stocks rose and 2,014 stocks declined, meaning the ratio of rising issues to declining stocks was 1.06 to 1. There were 49 new 52-week highs and 13 new lows for the S&P 500; there were 48 new highs and 156 new lows for the Nasdaq Composite Index.
Volume on U.S. exchanges was 10.75 billion shares, roughly in line with the moving average of the last 20 sessions.
