Ten of the 11 sectors finished lower, led by health care and energy sectors
U.S. stocks bounced off session lows on Wednesday, 27 March 2019 but finished in the red as sentiment remained sensitive to mounting signs of slowing global growth, reflected in falling bond yields on the heels of increasingly dovish central banks.
The Dow Jones Industrial Average dropped 32.14 points, 0.1%, to 25,625.59, while the S&P 500 index fell 13.09 points, or 0.5%, to 2,805.37 with health care and energy sectors among the worst performers. The tech-laden Nasdaq Composite Index shed 48.15 points, or 0.6%, to 7,643.38. P> Ten of the 11 S&P 500 sectors finished lower, led by health care and energy sectors. The industrial sector was the lone group to finish higher.
On the economic front, the Commerce Department report showed that the U.S. trade deficit decreased by 14.6% in January, driven by rising exports and falling imports. The U.S. exported $7.1 billion in goods to China in January, matching the lowest level since September 2010. Also, the weekly MBA Mortgage Applications Index jumped 8.9% following a 1.6% increase in the prior week. The key takeaway from the report is that the trade deficit narrowed after hitting its widest level in a decade in the previous reading. The current account deficit for the fourth quarter totaled $134.4 billion (consensus -$126.6 billion). The third quarter deficit was revised to $126.6 billion from $124.8 billion.
Data from China's National Bureau of Statistics, meanwhile, showed that profits at industrial firms fell by 14% in January and February, the largest decline since 2011.
Bullion prices ended lower at Comex on Wednesdday, 27 March 2019 at Comex. Gold futures fell on Wednesday to settle at their lowest in nearly a week, as some strength in the dollar contributed to a second straight session decline for the metal. A rally in government bonds across the globe, however, pointed to increased appetite for assets perceived as havens, and uncertainty surrounding Brexit and U.S.-China trade developments helped to limit losses for the yellow metal, which trades lower for the month so far, but up year to date.
April gold on Comex lost $4.60, or 0.4%, to settle at $1,310.40 an ounce, the lowest for a most-active contract since 21 March 2019. June, which is also among the most-active contracts, fell $4.50, or 0.3%, to $1,316.90 an ounce. Prices for both contracts turned slightly lower for the week. May silver settled 0.9% lower at $15.298 an ounce.
Crude oil finished lower on Wednesday, 27 March 2019 after a U.S. government report revealed a weekly increase in domestic crude supplies, defying market expectations for a third straight weekly decline. Futures prices, however, made only modest moves as investors continued to weigh signs of reduced global supplies on the back of efforts by major oil producers to curb production, the potential threat power outages in Venezuela pose the country's output, and worries about slowing economic growth that could sap oil demand.
West Texas Intermediate crude for May delivery on the New York Mercantile Exchange fell 53 cents, or 0.9%, to settle at $59.41 a barrel. May Brent crude which expires at Friday's settlement, lost 14 cents, or 0.2%, to $67.83 a barrel on ICE Futures Group.
The Energy Information Administration on Wednesday reported that U.S. crude supplies unexpectedly rose by 2.8 million barrels for the week ended March 22. Market had expected a fall of 2.2 million barrels, following two straight weeks of declines. Supplies of gasoline fell by 2.9 million barrels, while distillates declined by 2.1 million barrels last week. Market had shown expectations for supply declines of 3.6 million barrels for gasoline and 800,000 barrels for distillates.
In M&A news, health care company WellCare agreed to be acquired by Centene for $305.39/share in cash and stock.
Looking ahead, investors will receive several economic reports on Thursday, which will include the PCE Price Index for February, the Core PCE Price Index for January, the Chicago PMI for March, New Home Sales for February, and the revised University of Michigan Index for Consumer Sentiment for March.
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