The New York Stock Exchange on Wednesday, June 29, 2022 in New York. Stocks are off to a weak start on Friday, continuing a dismal streak that pushed Wall Street into a bear market last month as traders worry that inflation will be tough to beat and that a recession could be on the way as well. (AP Photo/Julia Nikhinson)
HONG KONG – Wall Street is wavering as its scorching November rolls toward the close of a third straight winning week. The S&P 500 was little changed early Friday, holding near its highest level in three months. The Dow was also nearly flat, and the Nasdaq composite slipped 0.2%. Several retailers were making strong gains after reporting better results than analysts expected for their latest quarter. Gap surged after reporting much higher profit than Wall Street had forecast. Ross Stores rose after reporting stronger profit and revenue than expected. Retailers are closing out what’s been a better-than-hoped earnings reporting season for the summer.
THIS IS A BREAKING NEWS UPDATE. AP’s earlier story follows below.
Wall Street pointed higher before the open Friday as most major markets looked set to end the week with solid gains.
Futures for the S&P 500 and the Dow Jones Industrial Average both edged 0.3% higher before the bell.
Shares of The Gap jumped more than 18% in off-hours trading after the fashion retailer breezed past Wall Street profit forecasts even as sales lagged from a year ago.
It’s been a busy week for retail earnings, with Target, Home Depot and Macy’s all reporting better-than-expected profits for the most recent quarter, though sales have lagged over the same period last year.
A report from the Commerce Department this week echoed those results, as Americans cut back on spending in October, ending six straight months of gains and pushing retail sales down 0.1%.
Wall Street’s stocks drifted to a mixed finish Thursday as market momentum slowed following the sizzling rally of the first half of November.
The S&P 500 edged up by 0.1% and was comfortably on track for a third straight winning week. The Dow industrials slipped 0.1% and the Nasdaq composite gained 0.1%.
November is on track to be the S&P 500’s best month in a year on rising hopes for a “Goldilocks” economy that’s just right for markets.
Several reports indicated the U.S. economy is slowing. Slightly more workers applied for unemployment benefits last week. The number is low relative to history, but a softening in the job market could prevent strong raises in wages that the Fed fears could help keep inflation high.
In Europe at midday, Germany’s DAX and the CAC 40 in Paris each were 0.9% higher, while Britain’s FTSE 100 surged 0.7%.
British retail sales volumes saw an unexpected decline in October, falling 0.3% from the month before according to data released Friday.
In Asian trading, Hong Kong’s Hang Seng sank 2.1%, to 17,454.19, dragged lower by a 9.8% slump in shares of Chinese e-commerce giant Alibaba following its cancellation of a plan to spin off its cloud computing unit. The company cited uncertainties due to U.S. chip restrictions. Alibaba shares dropped as much as 10% in New York on Thursday.
The Shanghai Composite index edged 0.1% higher to 3,054.37.
Tokyo’s Nikkei 225 index gained 0.5% to 33,585.20 after Bank of Japan Gov. Kazuo Ueda indicated, in comments to parliament, that the central bank has no immediate plans to change its ultra-lax monetary policy, which has kept the benchmark interest rate at minus 0.1% for years.
The gap between Japan’s negative interest rate and the U.S. benchmark rate of over 5.25% has pushed the value of the U.S. dollar much higher against the Japanese yen, complicating planning for corporations and raising costs for imports. But Ueda said the weak yen has both positives and negatives.
On Friday, the U.S. dollar was trading at 149.23 Japanese yen, down from 150.73 yen. The euro rose to $1.0870 from $1.0853.
In South Korea, the Kospi fell 0.7% to 2,469.85. Australia’s S&P/ASX 200 slipped 0.1% to 7,049.40. Taiwan’s Taiex gained 0.2% and the Sensex in Mumbai dropped 0.2%.
The yield on the 10-year Treasury fell to 4.41% early Friday from 4.44% Thursday. Just last month, it was above 5% at its highest level since 2007 and raising worries on Wall Street as it undercut prices for stocks and other investments. The yield on the 2-year Treasury also edged down, to 4.83% from 4.85% late Thursday.
A barrel of benchmark U.S. crude for delivery in December was up 95 cents at $74.04. On Thursday, it tumbled $3.76 to settle at $72.90. Brent crude, the international standard, gained $1.06 to $78.48 per barrel.
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