US close: Stocks end slightly higher after ISM services data
US stocks ended slightly higher on Tuesday as M&A news helped to boost the energy sector, while weak services data prompted investors to scale back rate hike expectations.
The Dow Jones Industrial Average and the S&P 500 both closed up 0.3% and the Nasdaq rose 0.5%. The US market was closed for trading on Monday for Labour Day.
Oil prices settled mixed even after Russia and Saudi Arabia made a vague promise in the previous session of greater cooperation to stabilise the market. West Texas Intermediate was up 0.9% at $44.83 a barrel while Brent crude was down 0.8% at $47.26.
“Oil has been in the spotlight again over the last 24 hours having rallied more than 5% at one point yesterday when a press conference was called for the Saudi Arabia and Russian oil ministers,” said Craig Erlam, senior market analyst at Oanda.
“The unexpected announcement sparked a sudden belief that a coordinated output freeze may be about to be announced but once again we were left listening to fluffy commitments to cooperation between the two oil producing giants.”
Meanwhile, figures from the Institute for Supply Management showed growth in the US economy’s services sector slipped more than expected in August.
The ISM services index fell to 51.4 in August from 55.5 the month before, missing expectations for a reading of 55.0 and hitting its lowest level since February 2010. A reading above 50 indicates expansion.
Naeem Aslam, chief market analyst at Think Markets, said: “When you see the ISM non-manufacturing number dropping like this, it shakes the floor on which traders are building the hopes that the Fed could increase the interest rate. A few more readings like this and you can say goodbye to interest rate hikes.”
Separately, the Federal Reserve’s labour market conditions index fell back into negative territory in August. The index, which combines 19 labour market indicators, dropped to -0.7 in August from a revised reading of +1.3 in July. Analysts had expected a reading of 0.0.
M&A activity helped to underpin the tone on Tuesday, with Spectra Energy racking up stellar gains after announcing a merger with pipeline firm Enbridge to create the largest energy infrastructure company in the US.
General Electric shares fell after it said it has agreed to buy two European 3-D printing companies for $1.4bn.
Seed giant Monsanto gained after German chemical company Bayer sweetened its bid for the group to $127.50 per share from $125 in July.
Chip maker Marvell Technology edged lower after reporting a decrease in quarterly revenue that was worse than forecast.
S&P 500 - Risers
Spectra Energy Corp. (SE) $41.00 +13.42%
Johnson Controls International PLC (JCI) $48.90 +7.59%
Eog Resources Inc. (EOG) $94.83 +6.66%
AES Corp. (AES) $12.84 +4.99%
Goodyear Tire & Rubber Co. (GT) $31.16 +4.81%
Helmerich & Payne Inc. (HP) $62.68 +4.14%
Newmont Mining Corp. (NEM) $42.00 +3.65%
Mallinckrodt Plc Ordinary Shares (MNK) $74.92 +3.45%
Endo International Plc (ENDP) $20.49 +3.38%
Yahoo! Inc. (YHOO) $44.71 +3.30%
S&P 500 - Fallers
Cummins Inc. (CMI) $116.94 -7.31%
Centene Corp. (CNC) $65.30 -4.84%
VeriSign Inc. (VRSN) $76.20 -3.57%
Nordstrom Inc. (JWN) $50.02 -3.57%
Hess Corp. (HES) $51.23 -3.49%
Discovery Communications Inc. Class A (DISCA) $25.09 -3.09%
Mosaic Company (MOS) $28.65 -2.85%
Qorvo, Inc. (QRVO) $56.02 -2.74%
Urban Outfitters Inc. (URBN) $35.19 -2.52%
Ingersoll Rand Ltd. (IR) $66.83 -2.48%
Dow Jones I.A - Risers
Chevron Corp. (CVX) $102.43 +1.49%
Boeing Co. (BA) $132.99 +1.40%
Intel Corp. (INTC) $36.58 +1.39%
Exxon Mobil Corp. (XOM) $88.57 +1.32%
McDonald's Corp. (MCD) $117.25 +1.23%
Verizon Communications Inc. (VZ) $53.51 +1.19%
American Express Co. (AXP) $65.76 +0.87%
Wal-Mart Stores Inc. (WMT) $73.00 +0.69%
Visa Inc. (V) $82.53 +0.65%
International Business Machines Corp. (IBM) $160.35 +0.50%
Dow Jones I.A - Fallers
Nike Inc. (NKE) $57.41 -1.05%
United Technologies Corp. (UTX) $106.01 -0.86%
Home Depot Inc. (HD) $134.10 -0.78%
General Electric Co. (GE) $31.05 -0.77%
Walt Disney Co. (DIS) $93.80 -0.66%
E.I. du Pont de Nemours and Co. (DD) $69.69 -0.57%
Unitedhealth Group Inc. (UNH) $135.97 -0.47%
3M Co. (MMM) $180.46 -0.19%
Microsoft Corp. (MSFT) $57.61 -0.10%
JP Morgan Chase & Co. (JPM) $67.44 -0.07%
Nasdaq 100 - Risers
Baidu Inc. (BIDU) $189.06 +6.34%
JD.com, Inc. (JD) $26.54 +3.87%
Endo International Plc (ENDP) $20.49 +3.38%
Yahoo! Inc. (YHOO) $44.71 +3.30%
Netflix Inc. (NFLX) $100.09 +2.78%
Tesla Motors Inc (TSLA) $202.83 +2.55%
Facebook Inc. (FB) $129.73 +2.55%
Regeneron Pharmaceuticals Inc. (REGN) $398.31 +2.49%
Symantec Corp. (SYMC) $24.81 +2.18%
Amazon.Com Inc. (AMZN) $788.87 +2.13%
Nasdaq 100 - Fallers
Ctrip.Com International Ltd. Ads (CTRP) $45.96 -4.05%
Discovery Communications Inc. Class A (DISCA) $25.09 -3.09%
Dish Network Corp. (DISH) $50.45 -2.57%
Discovery Communications Inc. Class C (DISCK) $24.47 -2.43%
Mattel Inc. (MAT) $32.90 -2.34%
PACCAR Inc. (PCAR) $57.84 -2.31%
Skyworks Solutions Inc. (SWKS) $73.01 -2.16%
Tractor Supply Company (TSCO) $83.55 -1.78%
Maxim Integrated Products Inc. (MXIM) $40.55 -1.39%
Broadcom Limited (AVGO) $171.10 -1.16%