MARKET SNAPSHOT: Stocks Struggle For Direction Following Comey Testimony

By Sue Chang and Mark DeCambre, MarketWatch Features Dow Jones Newswires

U.K. election results on deck Thursday

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U.S. stocks fought for direction Thursday afternoon after former FBI Director James Comey's appearance in front of the U.S. Senate Intelligence Committee concluded without any significant revelations.

The Dow Jones Industrial Average is off 4 points to 21,170 after hitting a record of 21,265.69 as strong gains in Goldman Sachs Group Inc. (GS) and J.P. Morgan Chase & Co. (JPM) shares offset much of the selling pressure.

The S&P 500 index slid 1 point to 2,431. Utilities were the biggest decliners while financials rallied more than 1%.

The Nasdaq Composite Index gained 8 points, or 0.1%, to 6,306 after setting an intraday record of 6,318.39.

"It is evident from the market's reaction that the testimony is more hype than substance, equivalent to preparing for a major storm that may not occur," said Kent Engelke, chief economic strategist at Capitol Securities Management Inc.

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Comey's testimony is part of a litany of potentially market-moving events playing out over the next 24 hours, including an earlier decision by the European Central Bank to keep its monetary policy unchanged and a U.K. snap election.

However, Wall Street investors were signaling that events don't appear to threaten the stock market's extended push into record territory, which has been driven by President Donald Trump's promises of tax cuts, infrastructure spending and deregulation.

"Testimony would have to be really, really damning enough to throw all of [Trump's policy promises] into the trash bin, and that's not what we have right now in this [Comey] testimony," said Mike Antonelli, chief equity sales trader at Robert W. Baird & Co.

(http://blogs.marketwatch.com/thetell/2017/06/08/mario-draghi-live-blog-ecb-drops-reference-to-potential-for-further-rate-cut/)Read:What to watch when James Comey testifies to the Senate on Thursday (http://www.marketwatch.com/story/what-to-watch-when-james-comey-testifies-to-the-senate-on-thursday-2017-06-05).

Comey's prepared statement, released Wednesday, suggests he was worried Trump had sought to secure his "loyalty" and wanted him to help "lift the cloud" from the investigation into possible Russian interference in the U.S. election was casting. Comey also confirmed the president's assertion that the director had repeatedly assured Trump that the FBI hadn't opened an investigation into him. He reiterated those assertions during his testimony in front of the Senate panel.

Engelke, meanwhile, believes that the coming House vote later Thursday to roll back the Dodd-Frank financial regulatory bill (http://www.marketwatch.com/story/house-set-to-pass-bill-rolling-back-wall-street-rules-2017-06-08-81035640) is likely to be supportive of stocks. If Dodd Frank is repealed, the circulation of capital in the markets will pick up and boost economic activity, he said.

"Because there are no major bombshell revelations and because of the coming vote in the House, my optimism is rising," said Engelke.

Phil Orlando, chief equity strategist at Federated Investors, said barring any surprises, recent events suggests that the stock market should drift higher.

"Ultimately, stock markets are going to reflect earnings," he said.

Orlando said the U.S. and Europe are showing strong quarterly results that may help to support gains in stocks that some strategists and investors view as overvalued.

Earlier in the day, the ECB, as expected, left interest rates unchanged (http://www.marketwatch.com/story/ecb-leaves-policy-unchanged-drops-reference-to-lower-rates-2017-06-08) but said it continued to expect interest rates "to remain at present levels for an extended period of time, and well past the horizon" of its asset-buying program, which is set to run at least through December. In previous statements, the ECB had said it expected rates "to remain at present or lower levels for an extended period of time."

Check out: A recap of the ECB's Mario Draghi news conference (http://blogs.marketwatch.com/thetell/2017/06/08/mario-draghi-live-blog-ecb-drops-reference-to-potential-for-further-rate-cut/)

Read:Why the ECB can take only 'baby steps' toward ending ultraloose monetary policy (http://www.marketwatch.com/story/draghis-ecb-may-take-baby-steps-toward-ending-ultraloose-monetary-policy-2017-06-06)

Beyond the ECB and Comey, investors also were focused on the U.K. general election,

In the U.K., voters headed to the polls in an election that turned out to be much more uncertain than anyone had predicted. Opinion polls are still giving Prime Minister Theresa May's Conservative Party the lead, but the big question is whether the party will increase its majority in parliament. Polling stations close at 10 p.m. London time (http://www.marketwatch.com/story/when-is-the-uk-election-and-when-do-we-know-who-won-2017-06-01), or 5 p.m. Eastern, and the first exit polls will be released immediately after.

Read:U.K. election--these are the stocks and sectors to watch once the result is in (http://www.marketwatch.com/story/watch-for-a-shake-up-among-uk-stocks-after-thursdays-election-2017-06-06)

(http://www.marketwatch.com/story/watch-for-a-shake-up-among-uk-stocks-after-thursdays-election-2017-06-06) (http://www.marketwatch.com/story/watch-for-a-shake-up-among-uk-stocks-after-thursdays-election-2017-06-06)Also read:U.K. election: The worst, best and most likely scenarios for stocks world-wide (http://www.marketwatch.com/story/uk-election-the-nightmare-best-case-and-most-likely-scenarios-for-stocks-worldwide-2017-06-01)

The pound traded at a two-week high as voting got under way, buying $1.2939, compared with $1.2960 late Wednesday in New York.

Economic news: A reading on weekly jobless claims dropped by 10,000 to 245,000 (https://www.dol.gov/ui/data.pdf) in the seven days stretching from May 28 to June 3, nearest the lowest levels in decades (http://www.marketwatch.com/story/us-jobless-claims-drop-10000-to-245000-2017-06-08).

Stock movers: Shares of Yahoo! Inc.(YHOO) rallied 8.6% after news late Wednesday that up to 1,000 layoffs are expected at the combined Yahoo and AOL companies set to be bought by Verizon Communications Inc.(VZ).

Advanced Micro Devices Inc. (AMD) rose 2.8% as shares build on recent days' sharp rally (http://www.marketwatch.com/story/amds-stock-extends-surge-fueled-by-tremendous-graphics-cards-demand-2017-06-07) following upbeat comments from Apple Inc. (AAPL) and brokers regarding the chip maker.

Shares of Alibaba Group Holding Ltd.(BABA) jumped 12% after the Chinese e-commerce giant said revenues are expected to grow between 45% and 49% in 2018.

Shares of Nordstrom Inc. (JWN) soared 10% following reports that the retailer is exploring taking itself private.

Other markets: Stocks in Asia closed mostly higher (http://www.marketwatch.com/story/asian-markets-sit-back-wait-for-global-news-to-pass-2017-06-07), although Japan's Nikkei 225 index bucked the positive trend. The losses in Tokyo came after the yen jumped on reports the Bank of Japan is running simulations of exits from quantitative easing.

European stocks were mixed following (http://www.marketwatch.com/story/european-stocks-search-for-firm-footing-with-ecb-uk-election-on-deck-2017-06-08) the ECB meeting and ahead of the U.K. election result.

Oil prices were flat (http://www.marketwatch.com/story/crude-futures-attempt-to-rebound-from-biggest-drop-in-a-month-2017-06-08) after posting the biggest drop since March in Wednesday's session. That slump followed a report of an unexpected climb in U.S. stockpiles.

Gold settled sharply lower, wiping out weekly gains (http://www.marketwatch.com/story/gold-drops-in-back-to-back-sessions-as-ecbs-position-change-lifts-dollar-2017-06-08), while the dollar was up 0.2% against other major currencies, including the euro (http://www.marketwatch.com/story/euro-churns-near-6-mo-high-on-view-ecb-to-take-small-steps-toward-loose-policy-reversal-2017-06-08).

--Sara Sjolin contributed to this article.

(END) Dow Jones Newswires

June 08, 2017 14:48 ET (18:48 GMT)