By Alex Veiga
Updated at 5:02 p.m. ET
US stock indices erased much of their early losses and closed slightly lower on Thursday, extending the S&P 500’s losing streak to a third day.
The S&P 500 was down 0.2% after falling 1.4%. Technology, healthcare and communications stocks accounted for the bulk of sales, offsetting small gains in banks and elsewhere in the market.
In the United States, investor optimism that the Trump administration and Congress will soon reach agreement on another round of economic stimulus has faded. And the government said Thursday that the number of Americans seeking unemployment assistance increased more than expected last week.
“The stimulus rhetoric continues to be a little negative, and the virus outbreak in Europe which is likely to cause more closures in various cities and countries is also a little negative,” said Scott Wren, strategist Global Market Principal, Wells Fargo Investment Institute.
Still, Wren added, the market expects Washington to provide another round of stimulus at some point and continues to expect various efforts to develop COVID-19 treatments and vaccines. come to term. If not, the recent pullback in equities would be much more severe, he said.
“The market is still pretty confident that we’re going to see good news on both fronts, but it doesn’t know when,” Wren said.
The S&P 500 fell 5.33 points to 3,483.34. The Dow Jones Industrial Average fell 19.80 points, or 0.1%, to 28,494.20. He had lost 332 points at the start. The Nasdaq composite lost 54.86 points, or 0.5%, to 11,713.87.
Small company stocks held up better than the market in general. The Russell 2000 small-cap index rebounded from an initial decline and rose 17.23 points, or 1.1%, to 1,638.88.
Shares were mostly up this month, but fell back this week as ongoing talks between Democrats and Republicans over an economic stimulus package fell through. Investors had hoped Washington would provide more financial support to the economy since July, when an additional $ 600 a week benefit for the unemployed expired.
The report follows recent data that pointed to a slowdown in hiring. The economy is still about 10.7 million jobs short of recouping the 22 million jobs that were lost when the pandemic struck in early spring.
The 10-year Treasury yield remained stable at 0.73%.
Investors continued to weigh the latest batch of corporate earnings reports in the US. Several reports so far have been better than expected, but the health crisis continues to cloud the outlook.
Across the S&P 500 as a whole, analysts expect companies to report a further decline in summer earnings from levels a year ago. But they expect the drop to be moderate from the nearly 32% fall in the spring, as the economy has shown signs of improvement.
A resurgence of coronavirus infections in Europe has also prompted investors to be cautious. There are fears that Europe may lack a chance to control the new outbreak, as infections soar to record daily highs in Germany, the Czech Republic, Italy and Poland. France has imposed a 9 p.m. curfew in many of its largest cities and Londoners face new travel restrictions as governments take increasingly tough measures.
The limits on public life are not as tight as the full lockdowns imposed in the spring, but will slow or even reverse the economic recovery after the recession, experts say.
European markets fell sharply after France imposed a curfew on many of its largest cities and Londoners faced new travel restrictions. The German DAX lost 2.5%. The CAC 40 in France fell by 2.1%. The FTSE 100 in London fell 1.7%.
In Asia, the Shanghai Composite Index lost 0.3% and the Tokyo Nikkei 225 fell 0.7%. The Hang Seng in Hong Kong lost 2.1%.
Big Hit Entertainment Ltd.’s share price doubled at noon, but ended the day near its opening. Its market value after an initial public offering that raised more than $ 800 million was around $ 7.5 billion.
AP business writer Joe McDonald contributed.