Nike falls after results
U.S. stocks ended slightly lower on Friday, as investors found few reasons to keep pushing shares higher going into a holiday-shortened week, especially with major indexes near records and posting their fifth straight weekly advance.
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Markets will be closed on Monday because of the Christmas holiday, while most European markets will also be closed on Dec. 26.
Read: When do financial markets close for Christmas? (http://www.marketwatch.com/story/when-do-financial-markets-close-for-christmas-2017-12-20)
What are markets doing?
The Dow Jones Industrial Average fell 28.23 points to end at 24,754.06, a decline of 0.1%. The S&P 500 slipped 1.23 points to 2,683.34, a drop of less than 0.1%. The Nasdaq Composite Index was off 5.4 points, or 0.1%, to 6,959.96 .All three indexes are within 1 percentage point of record levels.
For the week the Dow rose up 0.4%, while the S&P and Nasdaq rose 0.3%. Both the Dow and the S&P rose for a fifth straight week. Trade was thin, with total composite volume of 4.704 billion shares--the second lowest full-day volume this year.
What's driving the markets?
The gains this week in part came after the House of Representatives and the Senate approved a sweeping tax reform package, cutting the corporate tax rate to 21% from 35%, among other things. President Donald Trump signed the bill into law (http://www.marketwatch.com/story/trump-today-president-says-corporations-going-wild-as-he-signs-tax-bill-into-law-2017-12-22) on Friday.
Expectations related to tax cuts boosted markets in recent weeks on hopes it will give U.S. companies a boost and speed up economic growth. However, Morgan Stanley recently warned that the official passage of the bill could represent a near-term top for market (http://www.marketwatch.com/story/heres-why-the-stock-market-could-peak-the-day-trump-signs-the-tax-cut-bill-2017-12-18).
Meanwhile in Europe, Spanish stocks slumped after parliamentary elections in Catalonia handed a win to the separatist movement (http://www.marketwatch.com/story/spanish-stocks-slump-after-separatists-win-catalonia-election-2017-12-22), rekindling fears of the re-emergence of tensions in Spain. The iShares MSCI Spain Capped ETF (EWP), an exchange-traded fund that tracks Spain's equity market, fell 0.7%.
What's on deck in economics?
Orders for durable goods rose 1.3% in November (http://www.marketwatch.com/story/durable-goods-orders-rise-13-in-november-2017-12-22). While this represented an improvement after a 0.4% drop in the prior month, it was below the 2% growth that analysts had been expecting. Separately, consumer spending rose 0.6% in November (http://www.marketwatch.com/story/consumer-spending-jumps-06-in-november-savings-rate-declines-2017-12-22), while personal income was up 0.3%.
After the market opened, the University of Michigan reported consumer sentiment continued to drift lower in December (http://www.marketwatch.com/story/consumer-sentiment-continued-to-slowly-sink-in-december-2017-12-22), while new-home sales spiked, easily surpassing forecasts (http://www.marketwatch.com/story/new-home-sales-roar-to-a-fresh-high-as-builders-feed-a-market-starved-for-supply-2017-12-22).
What are strategists saying?
"The data was pretty much in line, albeit a bit soft on personal income and durable goods. There's a little disappointment about that, but this has been a great year and we're in a strong time, seasonally," said Wayne Kaufman, chief market analyst at Phoenix Financial Services.
Kaufman added that trading was likely to be quiet throughout the rest of the year, barring any unexpected news events. "Some managers may book some profits, but otherwise I don't think we'll drop down, nor rocket higher."
U.S.-based stock funds saw $17.47 billion in outflows this past week (http://www.marketwatch.com/story/stock-funds-see-biggest-weekly-outflows-in-more-than-two-years-2017-12-22), the highest weekly outflows since September 2015 according to BofA Merrill Lynch Global Research, which credited the move to profit taking.
Related: U.S. stock trading volume hit a three-year low in 2017 amid near-absent volatility (http://www.marketwatch.com/story/us-stock-trading-volume-hit-a-three-year-low-in-2017-amid-near-absent-volatility-2017-12-21)
Don't miss:Stock-market volatility could return in a big way in January: Goldman Sachs (http://www.marketwatch.com/story/stock-market-volatility-could-return-in-a-big-way-in-january-goldman-sachs-2017-12-21)
Which stocks are in focus?
Nike Inc.(NKE) fell 2.3% after the athletic gear company late Thursday reported earnings that topped Wall Street estimates (http://www.marketwatch.com/story/nike-shares-seek-direction-as-results-top-street-estimates-but-north-america-sales-dont-2017-12-21), but North American sales fell below consensus estimates. Shares of the Dow component are up 24.5% thus far this year.
Ignyta Inc.(RXDX) jumped 73% on heavy volume after the biotechnology company disclosed that it agreed to a merger (http://www.marketwatch.com/story/ignytas-stock-soars-on-heavy-volume-after-roche-merger-deal-2017-12-22)with Roche Holdings Inc.(ROG.EB)
Papa John's International Inc.(PZZA) fell 3.9% after a report in The Wall Street Journal late Thursday that the pizza chain's founder John Schnatter is stepping down as chief executive (http://www.marketwatch.com/story/papa-johns-founder-to-step-down-as-chief-executive-2017-12-21).
In the same vein, former Google CEO Eric Schmidt said Thursday he will step down as executive chairman (http://www.marketwatch.com/story/eric-schmidt-to-step-down-as-executive-chairman-of-alphabet-2017-12-21-17911113) of the search giant's parent company, Alphabet Inc.(GOOGL) in January. Shares were down 0.2%.
Energy shares rose 0.2% on the day, extending their recent outperformance. The sector rose 4.5% over the week, by far the biggest gain of any S&P 500 sector. However, it is also the only sector to be down for 2017, with a decline of 4%. Hess Corp.(HES) rose 1.5% on Friday while Occidental Petroleum Corp.(OXY) was up 0.6%. The Energy Select Sector SPDR ETF (XLE) rose 4.7% over the course of the week, its biggest weekly advance since April 2016 (http://www.marketwatch.com/story/energy-etf-on-track-for-best-week-in-more-than-a-year-2017-12-22).
On the downside, a number of stocks connected to cryptocurrencies fell on Friday, dropping alongside broad weakness in the digital-currency space. Advanced Micro Devices Inc. (AMD), whose chips are used in the "mining" of digital currencies, lost 3.2%.
What are other markets doing?
There was heavy volatility in bitcoin which at one point dropped below $11.000, according to CoinDesk (http://www.marketwatch.com/story/bitcoin-prices-slide-another-13-amid-fears-big-investors-are-cashing-out-2017-12-22), before trimming losses to change hands in recent action at $14,059.88--still a 9.7% decline on the day. The world's largest digital currency has lost more than a third of its value since hitting an all-time high on Dec. 17. The entire cryptocurrency space (http://www.marketwatch.com/story/how-much-has-been-lost-in-fridays-cryptocurrency-rout-nearly-150-billion-2017-12-22) came under heavy selling pressure on Friday.
Stocks in Asia closed mostly higher, with Japan's Nikkei 225 index rising 0.2% to 22,902.76.
Oil prices dropped 0.5% to $58.06 a barrel, while gold was up 0.1% at $1.271.60 an ounce.
The ICE dollar index was up 0.1% at 93.379.
(END) Dow Jones Newswires
December 22, 2017 16:26 ET (21:26 GMT)