J.C. Penney, latest retailer to disappoint, tumbles after results
U.S. stocks closed slightly lower on Friday to record their first weekly retreat in nearly a month as investors weighed an uncertain political environment stemming from President Donald Trump's firing of former Federal Bureau of Investigation Director James Comey.
The Dow Jones Industrial Average fell 22.81 points, or 0.1%, to finish at 20,896.61.
The S&P 500 index slipped 3.54 points, or 0.2%, to close at 2,390.90. The S&P 500's subdued action on Friday marks the 13th straight session that the large-cap index moved less than 0.5%, the longest streak since September 1995, according to the Dow Jones Data Group.
The Nasdaq Composite Index edged up 5.27 points to end at 6,121.23.
For the week, the Dow is off 0.5% and the S&P 500 fell 0.4%. The Nasdaq Composite rose 0.3%, its fourth straight weekly gain, although the smallest in the streak.
Major U.S. indexes continue to trade near record levels, and the CBOE Volatility index , a proxy for investor anxiety, has been trading near multidecade lows. The VIX fell 1.7% to 10.42, roughly half its long-term average of 20.
Don't miss:Technician sees absence of fear leading to stock market top in late May (http://www.marketwatch.com/story/top-technician-sees-absence-of-fear-leading-to-stock-market-top-in-late-may-2017-05-12)
"No one really knows what it means to have such a low VIX at a time of such high uncertainty, rising rates, high valuations, and corporate profits that aren't particularly strong," said Jonathan Angrist, chief investment officer of Cognios Capital. "It is very unusual."
The dominant story over the past few days has been the recent firing of Comey. While this is seen as having little direct impact on corporate profits or stock prices, prolonged uncertainty on this front could be a catalyst for greater investor anxiety and market declines.
"The market isn't overly concerned that Trump fired Comey or how he did it," said Bob Pavlik, chief market strategist at Boston Private Wealth.
Still, there are concerns that the administration's pro-business agenda could suffer if the Comey issue results in Trump losing political support from Republicans in Washington and his voter base, he added.
Read:Why investors still aren't freaking out over the Comey firing (http://www.marketwatch.com/story/why-investors-still-arent-freaking-out-over-the-comey-firing-2017-05-12)
Friday morning, the president tweeted that Comey should hope there are no "tapes" (http://www.marketwatch.com/story/trump-says-comey-should-hope-there-are-no-tapes-and-threatens-to-cancel-press-briefings-2017-05-12) of their conversations, a statement he didn't elaborate on.
See also:Here's why stocks could rally if Trump heads for the exit (http://www.marketwatch.com/story/heres-why-stocks-could-rally-if-trump-heads-for-the-exit-2017-05-12)
Meanwhile, retail sales and consumer prices rose in April, albeit by a slower pace than had been expected, offering a mixed picture of the state of the economy.
Read:Retail stocks rocked as Macy's casts pall on sector (http://www.marketwatch.com/story/retail-stocks-rocked-as-macys-casts-pall-on-sector-2017-05-11)
"Investors, increasingly, are looking for a stronger package of economic data releases as the Federal Reserve continues to telegraph a June rate increase," said Quincy Krosby, chief market strategist at Prudential Financial.
Economic docket: Philadelphia Fed President Patrick Harker, speaking at Drexel University in Philadelphia, said that the U.S. economy can handle two more interest rate increases this year as "things are looking good (http://www.marketwatch.com/story/feds-harker-backs-two-more-rate-hikes-this-year-saying-things-are-looking-good-2017-05-12)."
Retail sales rose 0.4% in April (http://www.marketwatch.com/story/retail-sales-strengthen-in-april-brightening-economic-outlook-2017-05-12), according to the Commerce Department, below the 0.5% increase that had been forecast. Separately, consumer prices rose 0.2% (http://www.marketwatch.com/story/us-consumer-prices-rebound-in-april-2017-05-12) while core CPI was up 0.1%, a smaller-than-expected increase.
The University of Michigan's read on consumer sentiment rose to 97.7 in early May, slightly ahead of expectations (http://www.marketwatch.com/story/consumer-sentiment-leaps-in-may-but-partisan-divide-remains-university-of-michigan-says-2017-05-12).
Stock movers:General Electric Co.(GE) fell 2.1% after Deutsche Bank downgraded the stock to sell (http://www.marketwatch.com/story/ges-stock-lead-dow-losers-after-analyst-downgrade-to-rare-sell-rating-2017-05-12), citing concerns over earnings quality. The industrial conglomerate was the largest decliner among Dow components.
Shares of J.C. Penney Co. Inc. (JCP) slumped 14% after the department-store chain reported a larger-than-expected fall in same-store sales.
Read:J.C. Penney options traders prep for an unusually wild ride after earnings report (http://www.marketwatch.com/story/jc-penney-options-traders-prep-for-an-unusually-wild-ride-after-earnings-report-2017-05-11)
(http://www.marketwatch.com/story/jc-penney-options-traders-prep-for-an-unusually-wild-ride-after-earnings-report-2017-05-11)Tidewater Inc.(TDW) pared losses but ended down 0.9% after the oil services company said it expects to file for bankruptcy by May 17 (http://www.marketwatch.com/story/tidewaters-stock-plunges-after-announcing-bankruptcy-plan-2017-05-12).
U.S.-listed shares of AstraZeneca PLC(AZN.LN) jumped 9.2% as the drugmaker posted positive, late-stage study results (http://www.marketwatch.com/story/astrazeneca-plans-imfinzi-submission-after-trial-2017-05-12) for cancer treatment Imfinzi.
Other markets: U.S. oil prices bounced back from earlier weakness to trade fractionally higher, putting it on track for a weekly gain of more than 3%. Investors remain hopeful that the Organization of the Petroleum Exporting Countries will extend a production-cut deal when it meets on May 25.
Read:Here's one thing that could scuttle an extension of OPEC's oil output cuts (http://www.marketwatch.com/story/heres-one-thing-that-could-scuttle-an-extension-of-opecs-oil-output-cuts-2017-05-12)
Asian stocks were mixed (http://www.marketwatch.com/story/asian-markets-pull-back-after-weak-earnings-in-us-2017-05-11), as some indexes retreated in step with U.S. stock losses, but Chinese equities gained. European stocks moved modestly higher (http://www.marketwatch.com/story/european-stocks-log-small-gains-as-vivendi-rallies-but-cartiers-parent-a-drag-2017-05-12).
Gold prices strengthened, while the dollar index was mostly flat.
--Barbara Kollmeyer contributed to this article.
(END) Dow Jones Newswires
May 12, 2017 16:39 ET (20:39 GMT)