PCE inflation, ISM readings are weaker than expected
U.S. stock-market benchmarks on Monday attempted to trade higher, with shares of Apple Inc., buoying early action, as investors digested a raft of economic reports and looked ahead to the start of the Federal Reserve's policy meeting on Tuesday.
Weaker-than-expected readings on inflation and manufacturing put a dent on modest gains, which had been bolstered by a congressional agreement to stem a government shutdown.
The S&P 500 index was up 2 points, or 0.1%, to 2,386, with five of the 11 main sectors trading in positive territory. Among sectors trading in the red, energy shares followed falling oil prices lower. Utilities were the biggest loser, down 0.6%, while technology stocks led the gains.
The Dow Jones Industrial Average was off by 11 points, or less than 0.1%, to 20,926, pressured by a 1.4% decline in Dow component Boeing Co.(BA).
Meanwhile, the Nasdaq Composite Index was within a hair's breadth of setting a fresh intraday high of 6,074.04, reaching 6,073.99, before retreating to trade up 21 points, or 0.4%, at 6,069.
Apple Inc.'s shares (AAPL) jumped 1.6%, setting an all-time high of 145.97 in early Monday trade. The stock is a major component in the three major U.S. stock indexes.
"Investors are relieved that the deal to run the government a little longer is in place," said Ian Winer, director of equity trading at Wedbush Securities.
A deal to fund the government (http://www.marketwatch.com/story/congress-reaches-deal-to-fund-government-through-september-2017-04-30) through Sept. 30 includes an increase in military spending, a priority for President Trump and his fellow Republicans. The agreement also includes $1.5 billion for border security, but says explicitly that the money can't be used to pay for the construction of a new border wall that Trump has made a signature campaign promise.
"The avoidance of a U.S. government shutdown helped markets shift from a neutral to more positive tone overnight in Asia," said Jasper Lawler, senior market analyst at London Capital Group, in a note early Monday. "The Japanese yen extended last week's losses on Monday as geopolitical risk retreated, helping Japanese stocks gain (http://www.marketwatch.com/story/japanese-stocks-end-higher-with-key-asian-and-european-markets-shut-for-holiday-2017-05-01)."
"With many market closed around the world including most of Europe, trading should be light on Monday," Lawler added.
In other political news, former Italian Prime Minister Matteo Renzi emerged victorious over the weekend in a key primary election (http://www.marketwatch.com/story/matteo-renzi-on-track-to-win-italys-democratic-party-election-2017-04-30), helping to soothe investors who have worried about disruptions to the status quo in Europe.
Economic news: (http://www.marketwatch.com/story/congress-reaches-deal-to-fund-government-through-september-2017-04-30)Consumer spending was unchanged in March, while personal income climbed 0.2%. The Federal Reserve's preferred measure of inflation (http://www.marketwatch.com/story/us-inflation-retreats-in-march-from-5-year-peak-2017-05-01), personal-consumption expenditures index, retreated from a five-month peak in March. The PCE index fell 0.2% to mark the first decline in more than a year.
A Markit report on manufacturing came in at 52.8. ISM manufacturing index fell to 54.8 in April, while Construction spending declined 0.2% in March.
Later in the week, investors face more possible market catalysts, as the Federal Reserve is due to make a policy announcement on Wednesday and the April jobs report arrives Friday.
See:Fed, jobs data and Apple earnings to keep investors busy (http://www.marketwatch.com/story/fed-jobs-data-and-apple-earnings-will-keep-stock-market-investors-busy-2017-04-29)
Individual movers: Shares in WGN America parent Tribune Media Co.(TRCO) jumped 7% following reports that 21st Century Fox Inc.(FOX) and private-equity firm Blackstone Group(BX) are in talks about a joint bid to buy the broadcaster (http://www.marketwatch.com/story/fox-blackstone-may-launch-joint-bid-for-tribune-media-report-2017-04-30).
Neurotrope Inc.(NTRP) shares plummeted (http://www.marketwatch.com/story/neurotrope-stock-drops-34-on-midstage-trial-results-for-alzheimers-drug-2017-05-01) 53% after the company released mid-stage clinical trial results for an Alzheimer's disease drug that were criticized by investors.
Ahead of the open, pay TV company (http://www.marketwatch.com/story/dish-network-profit-beat-expectations-but-sales-missed-as-subscribers-dropped-2017-05-01)Dish Network Corp.(DISH) and drug distributor (http://www.marketwatch.com/story/cardinal-health-reports-q3-profit-beat-revenue-miss-2017-05-01)Cardinal Health Inc.(CAH) both reported quarterly profit that beat expectations, but sales that missed forecasts. Shares of both were slightly lower.
Other markets:Oil futures (http://www.marketwatch.com/story/crude-prices-fall-extending-weak-april-tone-2017-05-01) traded moderately lower, and gold futures also stepped back. A key dollar index was slightly higher. The yield on the 10-year Treasury note was unchanged at 2.29%.
(END) Dow Jones Newswires
May 01, 2017 10:36 ET (14:36 GMT)