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Stock market ends Thursday with small losses after Powell rally fades

Stock market ends Thursday with small losses after Powell rally fades
Specialist Michael Pistillo center, works with traders at his post on the floor of the New York Stock Exchange this month. (Richard Drew / Associated Press)

U.S. stocks finished lower Thursday after an afternoon rally faded away, taking down banks and technology companies that benefited from Wednesday’s huge gains.

Deutsche Bank dropped after German authorities raided its offices on suspicion some of its employees helped clients launder money. Other financial stocks fell as interest rates again edged lower.

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Crude oil prices climbed after they briefly dipped under $50 a barrel overnight. The rebound helped energy stocks trade higher.

The mixed results followed Wednesday’s big rally spurred by remarks from Federal Reserve Chairman Jerome H. Powell, who said in a speech that the Fed might be almost done raising interest rates — and is willing to stop raising them at least temporarily so it can assess the effects of the last few years of increases.

Investors have been nervous that climbing interest rates will contribute to a damaging slowdown in economic growth. And that fear is one of the major reasons behind the slide in stocks this autumn.

On Thursday, the Federal Reserve released minutes from its monetary policy meeting in early November. The records show officials expressed concerns about a variety of threats to the economy, including the impact of tariffs, a slowing global economy and tightening financial conditions amid falling stock prices. The assessment was in line with Wednesday’s comments by Powell.

“That's what the Fed is trying to put out there, is they haven't gotten carried away with rate increases,” said Thomas Martin, portfolio manager at Globalt Investments in Atlanta. “The market wants to see that they are going to be gradual.”

The market briefly rallied after the minutes were released but later gave back much of those gains. For the day, the S&P 500 index shed 5.99 points, or 0.2%, to 2,737.80. The Dow Jones industrial average recovered from a morning loss of 163 points and ended down just 27.59 points, or 0.1%, to 25,338.84.

The Nasdaq composite slid 18.51 points, or 0.3%, to 7,273.08 as tech stocks dipped. Smaller companies, especially banks and industrial stocks, fared worse. The Russell 2000 index of smaller-company stocks lost 5 points, or 0.3%, to 1,525.39.

Benchmark U.S. crude rose 2.3% to finish at $51.45 a barrel in New York. Brent crude edged up 1.3% to $59.51 a barrel in London.

EOG Resources rose 1.6% to $105.47 and Anadarko Petroleum gained 2.2% to $53.70. The S&P 500 index of energy companies has dropped 12% over the last three months, worse than any of the other major market sectors. The S&P 500 itself has fallen 6% over that time.

Healthcare stocks, meanwhile, have jumped 7% in the last month, about double the gains in the broader market. On Thursday drugmaker Pfizer picked up 1.4% to $45.51 and medical device maker Medtronic added 1.3% to $96.60.

Bond prices edged higher. The yield on the 10-year Treasury note fell to 3.03% from 3.04%. Banks fell as investors expected slower increases in interest rates, which reduce the profits banks make from mortgages and other types of loans. Bank of America shed 1.4% to $28.04 and Bank of New York Mellon slid 1.8% to $50.68.

Deutsche Bank stock lost 4.8% to $9.42. German authorities suspect that Deutsche Bank employees helped clients set up offshore companies in tax havens to launder hundreds of millions of euros. A prosecutor in Frankfurt said the investigation emerged from an analysis of documents leaked from tax havens in recent years, including the 2016 “Panama Papers.”

Qualcomm stock gained 2.6% to $58.11 after Chief Executive Steve Mollenkopf said in an interview with CNBC that the company is close to resolving its long and costly dispute with Apple. Apple stopped making licensing fee payments to Qualcomm following a legal dispute between the companies, and later decided to stop using Qualcomm parts in some of its products.

But other technology companies fell. Intel lost 2.4% to $47.70. Apple slipped 0.8% to $179.55 and Microsoft dipped 0.8% to $110.19.

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In other commodities trading, wholesale gasoline jumped 4.1% to $1.45 a gallon. Heating oil edged up 0.3% to $1.84 a gallon. Natural gas slipped 1.1% to $4.65 per 1,000 cubic feet.

Gold was little changed at $1,230.40 an ounce. Silver slipped 0.4% to $14.40 an ounce. Copper lost 0.9% to $2.79 a pound.

The dollar slid to 113.43 yen from 113.53 yen. The euro edged up to $1.1389 from $1.1376.

The FTSE 100 in Britain and the French CAC 40 both rose 0.5%. Germany's DAX finished little changed.

Tokyo's Nikkei 225 rose 0.4% and Seoul's Kospi advanced 0.3% while Hong Kong's Hang Seng shed 0.9%.

2:05 p.m.: This article was updated with closing stock market results.

8:40 a.m.: This article was updated with the latest stock market results.

This article was originally published at 7:20 a.m.

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