Stocks fall for fourth day in row

Markets Writer

NEW YORK — Wall Street couldn’t shrug off doubts about the economy and government gridlock on Tuesday.

Mixed economic reports and concern about a government shutdown dragged stocks lower in the final half-hour of trading. They had been positive most of the day.

The modest losses extended the losing streak for the Standard &Poor’s 500 index to four days. It was the longest run of declines in a month. The Dow Jones industrial average also dropped for a fourth straight day.

Investors struggled with conflicting news about the economy on Tuesday. One report showed that home prices in July rose the most in more than seven years. Another showed that Americans’ confidence in the economy slipped in September.

Investors are searching for direction after the Federal Reserve’s surprise decision last Wednesday to keep its stimulus program intact. They had expected a reduction in the Fed’s $85 billion in monthly bond purchases. Investors are now parsing economic reports and comments from Fed officials to gauge the central bank’s next move.

Some are also nervous about political gridlock in Washington. They were concerned that the federal government could shut down because Washington lawmakers appear to be making little progress in budget talks.

“A government shutdown starting next week is looking increasingly likely,” said Jim Russell, a regional investment director at U.S. Bank. “That will not be welcomed by the capital markets.”

But Brad Sorensen, director of market and sector research at Charles Schwab, thought that worries about a government shutdown would ultimately be short-lived.

“Investors are becoming a little bit immune to the games that Washington has started to play,” Sorensen said. “Investors with a stronger stomach should probably buy the dip.”

Stocks, for example, plummeted in the summer of 2011 as lawmakers wrangled about raising the debt ceiling. The market also sagged in October last year before the Presidential elections, on concerns that a divided government would be unable to agree on tax reform. Each time though, backed by the Fed’s economic stimulus, the market came back stronger.

After falling 2 percent in October of last year, the Standard &Poor’s 500 index rose for seven straight months, gaining 15 percent.

On Tuesday, the Dow closed down 66 points, 0.4 percent, to 15,334. The S&P 500 index fell four points, or 0.3 percent, to 1,697. The Nasdaq composite, however, edged up three points, or 0.1 percent, to 3,768.

Stocks edged lower in early trading before moving modestly higher in the late morning and afternoon. Those gains then fizzled out at the end of trading.

Phone company stocks were the biggest decliners among the 10 industry groups that form the S&P 500. Industrial stocks were the biggest gainers.

Before the market opened, a survey showed that home prices rose the most since February 2006. A revival in housing has been one of the bright spots for the economy.

In another key economic gauge, the Conference Board, a New York-based private research group, said that its consumer confidence index dropped to 79.7 in September, down from August’s 81.8.

Consumers’ confidence is closely watched because their spending accounts for 70 percent of U.S. economic activity. Confidence has grown since the Great Recession, but it hasn’t hit a reading of 90, which typically accompanies a healthy economy.

They S&P 500 index is just 28 points below its all-time high reached last Wednesday, when investors were initially thrilled that the Fed extended its economic stimulus. Since then, the market has fallen each day as doubts emerge about the outlook for the economy, and budget negotiations.

In government bond trading, the yield on the 10-year Treasury note rose fell as investors bought bonds. The yield dropped from 2.70 percent late Monday to 2.66 percent, its lowest level in six weeks. The yield on the note is a benchmark for rates of consumer loans.

Among stocks making big moves:

— Software company Red Hat fell $6.20, or 12 percent, to $46.73 after it reported lower-than-expected quarterly billings and issued disappointing revenue forecasts.

—Carnival fell $2.86, or 8 percent, to $34.54 after the cruise ship operator warned revenue could drop more than its prior forecast.

— Applied Materials, a manufacturer of chip-making equipment, rose $1.45, or 9 percent, to $17.45 after it agreed to acquire a rival.

— Facebook rose $1.26, or 3 percent, to $48.45 after Citigroup upgraded the company’s stock to a “buy” recommendation from “neutral.” Facebook should continue to grow, helped by increasing advertising revenue contributions from its mobile website, Citigroup said.

Talk to us

More in Herald Business Journal

Homes in The Point subdivision border the construction of the Go East Corp. landfill on Wednesday, Nov. 10, 2021 in Everett, Wa. (Olivia Vanni / The Herald)
Mudslide briefly stalls housing project at former Everett landfill

The slide buried two excavators in September. Work has resumed to make room for nearly 100 new houses.

Ameé Quiriconi, Snohomish author, podcaster and entrepreneur.  (Kevin Clark / The Herald)
Snohomish author’s handbook charts a course for female entrepreneurs

She’s invented sustainable concrete, run award-winning wedding venues and worked in business… Continue reading

FILE - In this June 12, 2017, file photo, a Boeing 787 airplane being built for Norwegian Air Shuttle is shown at Boeing Co.'s assembly facility, in Everett, Wash. Boeing is dealing with a new production problem involving its 787 jet, in which inspections have found flaws in the way that sections of the rear of the plane were joined together. Boeing said Tuesday, Sept. 8, 2020, it's not an immediate safety risk but could cause the planes to age prematurely. (AP Photo/Ted S. Warren, File)
FAA memo reveals more Boeing 787 manufacturing defects

The company said the problems do not present an immediate safety-of-flight issue.

A final environmental cleanup is set to begin next year at the ExxonMobil and ADC properties, neighboring the Port of Everett. Photo courtesy of the Washington State Department of Ecology.
Port of Everett to get $350K for its costs in soil clean-up

The end is finally in sight for a project to scrub petroleum from two waterfront parcels, owned by ExxonMobil and ADC.

Shawn Loring, owner of Lazy Boy Brewing, received $10,000 through Everett's federal CARES Act funding.  (Kevin Clark / The Herald)
Everett, Snohomish breweries to open on Everett waterfront

Lazy Boy Brewing and Sound to Summit see a bright future at the port’s Waterfront Place.

A woman walks by models of Boeing Co. aircraft, including the manufacturer's new Boeing 777X, at the Dubai Air Show in Dubai, United Arab Emirates, Wednesday, Nov. 17, 2021. (AP Photo/Jon Gambrell)
India’s Akasa Air buys engines worth $4.5 billion for new 737 Maxs

Boeing clinched a deal at the Dubai Air Show to sell 72 of the jets for some $9 billion.

FAA Administrator Steve Dickson speaks to lawmakers as Michael Stumo, holding a photo of his daughter Samya Rose Stumo, and his wife Nadia Milleron, sit behind him during a Senate Committee on Commerce, Science, and Transportation hearing on the implementation of aviation safety reform at the US Capitol in Washington on Wednesday, Nov. 3, 2021. Samya Stumo was among those killed in a Boeing 737 Max 8 crash in 2019. (AP Photo/Amanda Andrade-Rhoades)
FAA says Boeing is appointing people lacking expertise to oversee airplane certification

The company was replacing senior FAA-authorized engineers who took early retirement during the pandemic.

FILE - In this Wednesday, July 17, 2019, file photo, Rep. Angie Craig, D-Minn., center, talks with Paul Njoroge, right, who lost his wife and three young children, as Michael Stumo, left, who lost his daughter, looks on before the start of a House Transportation subcommittee hearing on aviation safety, on Capitol Hill in Washington. The year since the crash of an Ethiopian Airlines Boeing 737 Max has been a journey through grief, anger and determination for the families of those who died, as well as having far-reaching consequences for the aeronautics industry as it brought about the grounding of all Boeing 737 Max 8 and 9 jets, which remain out of service. (AP Photo/Susan Walsh, File)
Boeing settles with Ethiopia 737 Max crash victims

The agreement allows victims’ families to pursue claims in U.S. courts instead of their home country.

Dennie Willard, a Navy veteran, became homeless in 2014 and began job training through HopeWorks at Renew Home and Decor. (Kevin Clark / The Herald)
Looking for his ‘last job,’ veteran found new work, new life

U.S. Navy veteran Dennis Willard, once homeless, now works for the nonprofit that helped him.

People hold signs in protest of the vaccine mandate along Airport Road next to Boeing on Friday, Oct. 15, 2021 in Everett, Wa. (Olivia Vanni / The Herald)
Report: 11,000 Boeing workers seek vaccination exemptions

Reuters says executives are scrambling to balance a company and federal mandate with the need to retain workers.

Port of Everett CEO Lisa Lefeber points back to the new retail site at Fisherman's Harbor at Waterfront Place during a groundbreaking ceremony on Monday, Nov. 8, 2021 in Everett, Washington. The project will construct two new buildings to house the new Asian-inspired Fisherman Jack’s restaurant, South Fork Bakery, and three marine-related offices adjacent to the new Waterfront Place Apartments and Hotel Indigo.
 (Andy Bronson / The Herald)
Port of Everett breaks ground on a new ‘restaurant row’

American-Chinese restaurant Fisherman Jack’s and South Fork Bakery are two businesses that will call the waterfront home.

A private plane taxis past the Paine Field passenger terminal on Wednesday, Nov. 3, 2021 in Everett, Wa. (Olivia Vanni / The Herald)
Forecast: A quadrupling of Paine Field passengers by 2040

How should Everett’s airport handle rebounding demand? A virtual meeting is set for Tuesday to talk about a master plan.