Wall Street bides its time, awaiting news from trade front

NEW YORK (Reuters) – Wall Street was largely unchanged on Thursday as market participants stayed on the sidelines, awaiting further developments in the hoped-for interim trade deal between the United States and China.

The S&P 500 .SPX and the Dow .DJI were slightly higher and the Nasdaq .IXIC nominally lower, their losses held in check by a rise in tech stocks.

Markets have been whipsawed in recent days as conflicting reports on whether the world’s two largest economies would be able to arrive at a “phase one” agreement prior to Dec. 15, when a new round of tariffs on Chinese imports is scheduled to take effect.

“We’re on hold until we see what happens on the trade front,” said Chuck Carlson, chief executive officer at Horizon Investment Services in Hammond, Indiana. “People are trying to get a read on what’s going to happen with the trade talks and the next relevant deadline is Dec 15.”

Market participants appeared to show little heed to the drama unfolding in Washington as the U.S. House of Representatives prepared to draft articles of impeachment against President Donald Trump.

“What impacts investor psychology is uncertainty, and I don’t think there’s any uncertainty as to how (the impeachment proceedings) will play out,” Carlson added.

“At the end of the day, whether there’s an impeachment or not isn’t going to stop a money manager from deciding whether or not he’ll by Intel (INTC.O).”

The articles of impeachment stem from a July 25 phone call in which Trump asked Ukrainian President Volodymyr Zelenskiy to carry out two investigations that would benefit him politically.

The Dow Jones Industrial Average .DJI rose 17.89 points, or 0.06%, to 27,667.67, the S&P 500 .SPX gained 2.02 points, or 0.06%, to 3,114.78 and the Nasdaq Composite .IXIC dropped 0.35 points, or -0%, to 8,566.32.

Traders work on the floor of the New York Stock Exchange shortly after the opening bell in New York, U.S., December 5, 2019. REUTERS/Lucas Jackson

Of the 11 major sectors in the S&P 500 seven were trading in the red.

Materials stocks .SPLRCM were the biggest winners, while consumer staples .SPLRCS suffered the largest percentage drop.

Nike Inc (NKE.N) gained 1.8% following Goldman Sachs’ upgrade of the sportswear maker’s stock to “buy” from “neutral.”

Kroger Co (KR.N) shares fell 3.5% after the supermarket chain missed Wall Street earnings estimates, hurt by stiff competition from Walmart Inc (WMT.N) and Amazon.com Inc (AMZN.O).

Online craft retailer Etsy (ETSY.O) dipped 2.7% on the heels of a downgrade to “underweight” by Morgan Stanley.

SecureWorks Corp (SCWX.O) jumped 22.8%, on course for its best day ever, after the cyber security firm posted a surprise third-quarter profit.

Sage Therapeutics Inc (SAGE.O) tumbled 59.1% after its depression drug failed in a late-stage study.

On the economic front, a shrinking trade deficit, a drop in jobless claims and a rebound in factory orders suggested a still-robust, if slowing, U.S. economy.

Investors now look to Friday’s employment report from the U.S. Labor Department, which is expected to show an increase of 180,000 nonfarm payrolls in November.

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Advancing issues outnumbered declining ones on the NYSE by a 1.02-to-1 ratio; on Nasdaq, a 1.02-to-1 ratio favored advancers.

The S&P 500 posted 11 new 52-week highs and 3 new lows; the Nasdaq Composite recorded 46 new highs and 53 new lows.

(This story has been refiled to fix a typo in first sentence).

Reporting by Stephen Culp in New York; Editing by Matthew Lewis

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