Eight of eleven sectors end in negative territory
U.S. stock-market indices closed slightly lower on Tuesday, 19 December 2017 as the House of Representatives, as expected, passed a bill that would deliver sweeping corporate tax cuts. The process hit a procedural snag after U.S. markets closed, however, which will force the House to vote again on the package Wednesday.
The Dow Jones Industrial Average slipped 37.45 points, or 0.2%, to 24,754.75, after hitting an all-time high earlier, at 24,876.07 shortly after the opening bell. The S&P 500 fell 8.69 points, or 0.3%, to 2,681.47, with eight of the 11 main sectors finishing in negative territory. The tech-concentrated Nasdaq Composite Index COMP, -0.44% declined 30.91 points, or 0.4%, to 6,963.85.
The real estate and utilities sectors led the decliners followed by telecom and technology stocks.
Reviewing Tuesday's economic data, which included November Housing Starts, November Building Permits, and the Current Account Balance for the third quarter, housing starts increased to a seasonally adjusted annualized rate of 1.297 million units in November (consensus 1.259 million), up from a revised 1.256 million units in October (from 1.290 million). Building permits decreased to a seasonally adjusted 1.298 million in November (consensus 1.280 million) from a revised 1.316 million in October (from 1.297 million). The key takeaway from the report is that there was a 1.4% increase in permits for single-family homes and a 5.3% increase in single-family starts, as that is where supply growth is greatly needed to meet home buyer demand.
Separately, the current account deficit for the third quarter totaled $100.6 billion (consensus -$117.4 billion). The second quarter deficit was revised to $124.4 billion from $123.1 billion.
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Bullion prices ended lower on Tuesday, 19 December 2017 at Comex. Gold ended lower to snap a four-day win streak as Treasury yields jumped and the dollar rose off session lows ahead of the House of Representatives' vote on legislation that would slash corporate tax rates.
February gold, the most active contract on Comex, lost $1.30, or 0.1% to close at slipped 90 cents, or 0.1%, to close at $1,264.20 an ounce. For the year gold remains up about 9.7%, though it has struggled in a tight range in recent weeks. March silver fell 5 cents, or 0.3%, to $16.15 an ounce.
Crude oil prices rose modestly on Tuesday, 19 December 2017 as the market remained broadly rangebound ahead of U.S. inventory data and the expiration of the January West Texas Intermediate contract. The continued outage of a North Sea pipeline also helped keep a floor under crude futures.
The January WTI crude contract expired at $57.46 a barrel, a gain of 30 cents or 0.5%. February WTI, which is now the front month, rose 34 cents, or 0.6%, to end at $57.56 a barrel. February Brent, the global benchmark, rose 39 cents, or 0.6%, to end at $63.80 a barrel on the Intercontinental Exchange.
The 10-year Treasury yield rose 7 basis points to 2.46%, the highest level in more than seven weeks. The ICE U.S. dollar index was weaker, however, falling 0.3% to 93.440.
On Wednesday, investors will receive the weekly MBA Mortgage Applications Index and November Existing Home Sales (consensus 5.56 million). The two reports will be released at 7:00 ET and 10:00 ET, respectively.
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