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US Stocks Drift Near Records, Gold Down10/22 09:37
Stocks are drifting near their record heights on Wall Street Wednesday,
while the price of gold falls again to trim more off its tremendous gain for
the year.
NEW YORK (AP) -- Stocks are drifting near their record heights on Wall
Street Wednesday, while the price of gold falls again to trim more off its
tremendous gain for the year.
The S&P 500 slipped 0.1% in morning trading and is sitting just underneath
its all-time high, which was set earlier this month. The Dow Jones Industrial
Average was down 99 points, or 0.2%, coming off its own record. The Nasdaq
composite was 0.3% lower, as of 10:15 a.m. Eastern time.
Bank stocks were holding relatively steady after Capital One Financial,
Western Alliance Bancorp and others reported stronger profits for the summer
than analysts expected. The report from Western Alliance was particularly
welcome after it helped shake confidence in the industry last week. It's one of
several banks that have warned of potentially bad loans on its books, possibly
because of fraud.
Intuitive Surgical, which sells robotic-assisted surgical systems, jumped
16.3%, and Boston Scientific climbed 4.2% after they likewise reported better
profits for the latest quarter than analysts expected.
It's usually the case that the majority of companies deliver better profits
each quarter than analysts had forecast. But the pressure is higher on
companies to do so this time around because of criticism that their stock
prices shot too high following a 35% romp for the S&P 500 from a low in April.
Netflix's stock, for example, came into the day with a jump of 39.3% for the
year so far, more than double the S&P 500's gain. But its stock dropped 8.6% on
Wednesday after it delivered weaker results for the latest quarter than
expected.
AT&T fell 2.3% after delivering a profit that only matched analysts'
expectations, while Texas Instruments sank 5.1% after its profit fell just
short of forecasts.
Beyond Meat, meanwhile, continued its meme-stock run and soared another
85.9% to bring its stunning gain for the week to 942%. Part of Beyond's rise
could be due to a recent announcement that Walmart will increase availability
of some of its products at over 2,000 U.S. stores.
The maker of plant-based meat alternatives was also the biggest holding in
the Roundhill Meme Stock exchange-traded fund, as of Tuesday. The ETF holds
stocks of companies where investors have piled in almost regardless of their
financial prospects, simply in hopes of catching a wave.
Momentum was continuing to head the other way for gold, which slipped 0.7%
to $4,080.50 per ounce. That's after Tuesday's 5.3% slide knocked it off its
record high.
Many of the same factors that drew buyers to gold this year are still there.
Expectations are still for the Federal Reserve to cut interest rates through
next year. Concerns are growing about inflation remaining high. And the
worrisome mountains of debt that the U.S. and other governments worldwide have
amassed are only rising further.
But no investment's price goes up forever, and criticism had been growing
that gold's price had gone too far, too fast after it shot up even more than
the U.S. stock market. Gold's price is still up more than 50% for the year so
far.
In stock markets abroad, indexes were mixed across Europe and Asia.
London's FTSE 100 rose 1.1% after a report on U.K. inflation raised hopes
for another cut to interest rates next month. South Korea's Kospi jumped 1.6%
for another one of the worlds bigger gains. But indexes fell 0.9% in Hong Kong
and 0.4% in Paris.
In the bond market, the yield on the 10-year Treasury edged down to 3.97%
from 3.98% late Tuesday.
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