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BUSINESS Wednesday 30 OctOber 2019
A25

S&P 500 drifts around record as health care stocks climb

By STAN CHOE economy.
Associated Press It's a sharp turnaround from
NEW YORK (AP) — U.S. late last year, when the
stocks drifted around their Fed was raising rates and
record highs Tuesday, and worrying investors that it
the S&P 500 slinked be- was increasing them too
tween small gains and loss- much, too fast. Lower rates
es following a mixed set of make borrowing cheaper
earnings reports from big for companies and house-
companies. holds, which can stimulate
Health care stocks jumped the economy and also
on stronger-than-expected make stocks look more at-
reports from drugmakers, tractive relative to bonds.
but losses for internet and Most investors expect a
media companies held the rate cut to come Wednes-
market in check following a day, but they're much less
mixed report from Google's certain what will happen
parent. after that.
Companies have largely The yield on the 10-year
been reporting stronger Treasury dipped to 1.83%
earnings than analysts ex- from 1.85% late Monday.
pected, but they're no- The two-year yield, which is
where close to blow-away Davis O'Day, center, works with fellow traders on the floor of the New York Stock Exchange, Tues- more sensitive to moves by
good. S&P 500 companies day, Oct. 29, 2019. the Fed, fell to 1.63% from
are still on track to report Associated Press 1.64%.
a third straight quarter of TRADE WATCH: The only is-
profit declines, according p.m. Eastern time. It set a from energy companies, drugs, cancer drug Keytru- sue more important than
to FactSet. record on Tuesday, surpass- raw-material producers da and vaccine Gardasil. interest rates to markets in
What's helped buoy the ing its prior peak set in late and technology compa- REVVED UP: General Mo- the short term is the U.S.-
market in recent weeks July. nies. Wall Street is expect- tors climbed 5%. The work- China trade battle, Jeffrey
are hopes that the United The Dow Jones Industrial ing stronger growth, mean- ers' strike that brought its Halley of Oanda said in a
States and China can make Average was little changed while, from companies that U.S. factories to a standstill commentary.
progress on their trade dis- at 27,095 and the Nasdaq do most of their business forced it to report a drop in The two sides are continu-
pute, or at least stop mak- composite slipped 0.3%. domestically, such as utili- profits, but the results were ing to talk, but uncertainty
ing it worse. Lower interest NOT BAD, BUT NOT GREAT: ties and real-estate com- nevertheless better than is high on what will come of
rates have also played a Nearly half of all the com- panies. Wall Street expected. it. China on Tuesday prom-
big role, and the Federal panies in the S&P 500 have Over the long term, stock MIXED LETTERS: Google's ised more improvements in
Reserve will wrap up a two- told investors how much prices tend to track the parent company, Alpha- conditions for foreign com-
day meeting Wednesday they earned from July path of corporate profits. bet, dropped 2.1% fol- panies, which has been
on rate policy. through September, and HEALTHY RESULTS: Health lowing its mixed earnings a key factor in the trade
Most investors expect the the index is on pace to re- care stocks had the biggest report. Revenue came in dispute. But it also sepa-
Fed to cut short-term rates port a profit drop of 3.5% gains among the 11 sectors better than Wall Street's rately accused the U.S. of
by a quarter of a percent- from the prior year, accord- that make up the S&P 500 expectations, but profit fell "economic bullying be-
age point to offer some ing to FactSet. following better-than-ex- short. havior" after U.S. regulators
protection from the trade That's not as bad as the pected reports from Pfizer RATE WATCH: The Fed has cited security threats while
war and the slowing global roughly 4% decline that and Merck. cut rates twice since the proposing to slash funding
economy. If investors are analysts were expecting Pfizer rose 3% after it raised summer in hopes of shield- for Chinese equipment in
right, it would be the third on the eve of earnings re- its forecast for the year. ing the United States from U.S. telecommunications
such cut since the summer. porting season, but it would Merck gained 3.4% after the effects of President networks.q
Treasury yields dipped be the first time that profits reporting big jumps in sales Donald Trump's trade wars
ahead of the decision, dropped for three straight for its top two blockbuster and the slowing global
while global stock markets quarters since 2015-2016.
were mixed. The price of Trade wars and the slowing
crude oil dropped a sec- global economy are hit-
ond straight day, and gold ting companies that do lots
dipped lower. of business overseas, and
KEEPING SCORE: The S&P analysts say the sharpest
500 was up 0.1% as of 12:19 earnings declines will come