Apple suffers worst week ahead of an iPhone launch; Small-cap Russell 2000 ends at a record
U.S. stocks bounced late in the session, paring early losses and ending little changed on Friday as investors shook off the latest bellicosities between North Korean and U.S. leaders.
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The S&P 500 closed 1.62 points higher at 2,502.22, posting a weekly gain of less than 0.1%. Of the 11 main sectors, six finished in positive territory. Health-care shares (http://www.marketwatch.com/story/health-care-stocks-spike-higher-after-mccain-says-no-to-graham-cassidy-2017-09-22)rebounded to erase earlier declines and finish slightly higher after Republican Sen. John McCain (http://www.marketwatch.com/story/mccain-says-hes-a-no-on-obamacare-repeal-bill-making-passage-unlikely-2017-09-22) announced he wouldn't sign the latest health-care bill to repeal the Affordable Care Act. Telecoms shares were the best performers, gaining 1.4%.
The Nasdaq Composite Index closed 4.23 points, or less than 0.1%, higher at 6,426.92 but ended the week 0.3% lower.
The Dow Jones Industrial Average ended the session down 9.64 points, or less than 0.1%, to 22,349.59 and posted a 0.4% weekly gain.
Meanwhile, the small-capitalization focused Russell 2000 index closed at a record after adding 6.60 points, or 0.5%, to 1,450.78, marking its first record close since July 25, as the small-cap index has lagged behind large-caps this year. The small-cap benchmark gained 1.3% over the week. Its year-to-date increase is about 7%, compared with 12% for the S&P 500.
A rise in shares of some of the smallest companies to all-time highs can be perceived as a bullish market indicator.
Some analysts said the stock market has become desensitized to threats from North Korea.
"As long as there is no military action from the either side, markets will continue to ignore the threats from North Korea," said Wouter Sturkenboom, senior investment strategist at Russell Investments.
North Korea returned to the forefront after the country's foreign minister Ri Yong Ho said late Thursday at a United Nations that his country might consider a nuclear bomb of "unprecedented scale" in the Pacific.
Ri's comments came shortly after North Korea's President Kim Jong Un released a statement threatening to make President Donald Trump "pay dearly" for his fiery speech to the U.N. on Tuesday, calling the U.S. leader a "mentally deranged U.S. dotard." (http://www.marketwatch.com/story/kim-jong-un-calls-trump-mentally-deranged-us-dotard-setting-off-scramble-for-dictionaries-2017-09-21)
The statements follow Trump's U.N. speech on Tuesday, where he pledged to "totally destroy" North Korea if Pyongyang provoked the U.S. or its allies. Trump on Thursday ordered expanded sanctions against North Korea, targeting individuals or companies trading with the country.
"The market has looked at this ongoing kerfuffle and said, 'Meh.' Right now there are just words being thrown back and forth, and it won't care until that changes or escalates," said Malcolm Polley, president and chief investment officer of Stewart Capital Advisors. "So long as rates stay low there's no real catalyst to drive the market down, even though no place in it looks particularly cheap and we think the risk premium being assigned to stocks is too low."
Equities have been broadly higher for an extended period. Major U.S. indexes have been trading near records, and with a modest dip on Thursday, the Dow ended a nine-day streak of gains (http://www.marketwatch.com/story/thatll-do-dow-the-averages-9-day-rally-is-overbut-still-historic-2017-09-21). Many investors could be looking for a reason to take profits, particularly with equity prices seen as stretched.
In the latest economic data, a read on manufacturing inched higher in September, while a read on the services sector was down slightly.
Asia markets closed mostly lower (http://www.marketwatch.com/story/asian-markets-rattled-by-latest-north-korean-nuclear-threat-2017-09-21) after the aggression from North Korea, while European settled slightly higher (http://www.marketwatch.com/story/european-stocks-shaken-by-north-korea-but-strong-pmis-keep-losses-in-check-2017-09-22).
Gold prices settled 0.2% higher at $1,297.50 an ounce, while the yen rallied against the dollar . The greenback bought Yen112.00, down from Yen112.48 late Thursday in New York.
The ICE Dollar Index dropped 0.1% to 92.168, set to erase its weekly gain. The dollar gauge on Wednesday jumped the most since January, according to FactSet data, after the Federal Reserve hinted interest rates would be raised once more before the end of the year.
Crude-oil prices added 0.2% to close at $50.66 (http://www.marketwatch.com/story/oil-prices-fluctuate-as-uncertainty-persists-over-opec-production-cut-extension-2017-09-22)a barrel after a meeting of members of the Organization of the Petroleum Countries.
Read:Longtime laggers, an 'important turn is happening' in energy stocks (http://www.marketwatch.com/story/longtime-laggers-an-important-turn-is-happening-in-energy-stocks-2017-09-20)
Stock movers:Sprint Corp. (S) and T-Mobile US Inc. (TMUS) both rallied following a report (http://www.marketwatch.com/story/sprint-t-mobile-us-shares-jump-premarket-on-report-companies-are-close-to-merger-terms-2017-09-22) that the companies are close to agreeing on tentative terms on a merger agreement. Sprint surged 6.1% while T-Mobile gained 1.1%.
CarMax Inc.(KMX) shares jumped 7.8% after quarterly earnings and revenue beat Wall Street expectations.
Shares of DaVita Inc.(DVA) dropped 6.2% after a Southern Investigative Reporting Foundation (SIRF) report questioned the company's revenue sources.
Equifax Inc.(EFX) shares jumped 6.9% on Friday and booked a 13% weekly gain. Equifax shares plunged more than 30% in the wake of data breach that compromised sensitive information of 143 million Americans.
Shares of Versartis Inc.(VSAR) sank 88% to $2.68 after the biopharmaceutical company late Thursday said its drug somavaratan failed to meet its primary endpoint in a phase 3 trial (http://www.marketwatch.com/story/versartis-shares-halted-2017-09-21).
Apple Inc.(AAPL) shares closed down 1% and lost 5% over the week, making it the worst week ahead of an iPhone launch (http://www.marketwatch.com/story/apple-stock-on-track-for-worst-week-ahead-of-an-iphone-launch-2017-09-21) since the original iPhone was released back in 2007. The lackluster performance comes after less-than-stellar reviews on its new slate of product offerings.
(END) Dow Jones Newswires
September 22, 2017 17:25 ET (21:25 GMT)