Stocks finish mostly lower after a wobbly day
U.S. stocks wobbled and finished mostly lower Monday as investors waited for central bank meetings in the United States and Japan. Healthcare and technology companies took some of the biggest losses. Banks rose.
Investors were indecisive as leaders of the U.S. Federal Reserve and the Bank of Japan prepared to meet, and stocks swung several times between gains and losses. The Dow rose as much as 131 points early on, then was down as much as 30 points in the afternoon. Banks, utility companies and machinery makers rose. Bond yields edged higher and the dollar weakened.
Russ Koesterich, head of asset allocation with BlackRock’s Global Allocation Fund, said investors don’t expect the Fed to raise interest rates. However, he said, investors have more questions about the Bank of Japan’s plans.
Japan’s central bank “could decide to introduce more stimulus, but it could take a lot of different forms,” he said. “One of the questions is not only what will they do, but what would the market like to see?”
Although advancing stocks far outnumbered decliners, the Dow Jones industrial average slipped 3.63 points, or less than 0.1%, to 18,120.17. The Standard & Poor’s 500 index edged down 0.04 of a point to 2,139.12. The Nasdaq composite fell 9.54 points, or 0.2%, to 5,235.03.
The Federal Reserve is to meet Tuesday and announce its latest decision on interest rates the following day. Banks got a boost as some investors hoped that interest rates will rise, which would enable banks to make more money from lending. JPMorgan Chase rose 0.6% to $66.19 and Wells Fargo rose 1.3% to $46.01.
Technology products distributor Tech Data soared 22.3% to $84.80 after it said it will buy the technology solutions business of Avnet for $2.6 billion in cash and stock. Tech Data said the deal will give it operations in 35 countries. Avnet shares jumped 6.8% to $41.89.
Network control company Infoblox, based in Santa Clara, Calif., surged 15.4% to $26.35 after it agreed to be bought by Vista Equity Partners for $26.50 a share, or $1.51 billion.
Despite those gains, the broader technology sector gave up an early advance and finished mostly lower. Apple, which surged last week and reached its highest price this year, fell 1.2% to $113.58. Intel slid 1.4% to $37.16.
Healthcare stocks also lagged behind the overall market. Merck fell 1.5% to $61.33 after rival Sanofi said it sued the company. Sanofi says Merck infringed on patents protecting its insulin drug Lantus. Eye drug maker Regeneron Pharmaceuticals fell 1.4% to $402.83.
Sarepta Therapeutics soared 73.9% to $48.94 after the Food and Drug Administration granted tentative approval to its drug Exondys 51. The drug treats Duchenne muscular dystrophy, a rare and deadly inherited disease that causes muscle weakness and eventually the loss of all basic movement and that usually causes death by age 25. The FDA had hesitated to approve the drug because advisors said there was little evidence it worked. Its approval is based on a study of only 12 patients, and the FDA is ordering Sarepta to run a larger study.
Isle of Capri Casinos leaped 30.2% to $22.04 after it agreed to be bought by Eldorado Resorts for $23 a share, or $950 million in cash and stock. Combined, the companies own 21 casinos and race tracks. Eldorado stock fell 2.9% to $13.84.
Health website operator WebMD slumped 5.7% to $49.02 after it said Chief Executive David Schlanger is leaving the company by mutual agreement. Schlanger is being replaced by President Steven Zatz, who is in charge of WebMD’s advertising and sponsorship business. WebMD shares are down 27% since May 25.
General Motors rose 2.4% to $31.72 after an analyst said auto sales, which are at record highs, should remain strong for several years. Analyst Adam Jonas of Morgan Stanley raised his rating on GM to “overweight” and raised his price target to $37 a share from $29.
Benchmark U.S. crude advanced 27 cents to $43.30 a barrel. Brent crude, used to price international oils, rose 18 cents to $45.95 a barrel.
Wholesale gasoline fell 4 cents, or 2.8%, to $1.42 a gallon. Heating oil fell 1 cent to $1.39 a gallon. Natural gas fell 1 cent to $2.93 per 1,000 cubic feet.
Gold rose $7.60 to $1,317.80 an ounce. Silver rose 43 cents, or 2.3%, to $19.29 an ounce. Copper remained at $2.16 a pound.
U.S. government bond prices slipped. The yield on the 10-year U.S. Treasury note rose to 1.71% from 1.69%. The dollar fell to 101.81 yen from 102.42 yen. The euro rose to $1.1178 from $1.1151.
The FTSE 100 index of leading British shares climbed 1.5% and the CAC-40 in France rose 1.4%. Germany’s DAX was up 1%. South Korea’s Kospi advanced 0.8% and Hong Kong’s Hang Seng index rose 0.9%. Trading in Japan was closed for a holiday. Australia’s stock market suspended trading after a couple of hours because of technical glitches, and the S&P/ASX 200 finished little changed.
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UPDATES:
2:05 p.m.: This article was updated with additional information.
1:20 p.m.: This article was updated with the close of markets.
7:45 a.m.: This article was updated with more recent stock information and additional details.
This article was originally published at 7 a.m.
