Stocks waffle as investors rotate into defensive areas

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Alan Greenspan: This is a very extraordinarily subdued economy

Former Federal Reserve Chairman Alan Greenspan on inflation, the outlook for Federal Reserve policy.

U.S. stocks swung between losses and gains on Thursday with the Nasdaq Composite and S&P 500 ended the session lower, while the Dow Jones Industrial Average managed to hang onto gains. Investors shifted into safer sectors such as utilities and consumer staples, while rotating out of materials and consumer discretionary names, both more dependent on U.S. economic growth which some speculate may be slowing.

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TickerSecurityLastChange%Chg
I:DJIDOW JONES AVERAGES26935.07-159.72-0.59%
SP500S&P 5002992.07-14.72-0.49%
I:COMPNASDAQ COMPOSITE INDEX8117.674437-65.20-0.80%

Speaking exclusively to FOX Business, Former Federal Reserve Chair Alan Greenspan, raised that very point. “We have monthly data which suggests that we are slowing down, we are not going negative, but we are definitely slowing down – the rate of growth as we go into 2019 probably at a 2 to 2.5 percent pace maximum" he said during an interview with Maria Bartiromo.

Sectors taking a hit today include transportation stocks including the airlines after Delta Airlines disclosed that profits next year would be lower than analysts had expected and lower than the current year. While fuel costs will be lower in 2019, the company said it faced a "$2 billion headwind from fuel costs" this year. Shares of the major airlines fell in sympathy. In autos, General Motors lost ground after President Trump lashed out at the automaker and CEO Mary Barra over planned factory closings during an interview with Fox News.

TickerSecurityLastChange%Chg
DALDELTA AIR LINES INC.58.63-0.06-0.10%
AALAMERICAN AIRLINES GROUP INC.27.99-0.31-1.10%
JBLUJETBLUE AIRWAYS16.92-0.19-1.11%
LUVSOUTHWEST AIRLINES CO.54.49-0.59-1.07%

There was some mixed news on the global front. President Mario Draghi says strong domestic demand and low interest rates are supporting the economy in Europe despite a recent moderation in growth.  He spoke after the bank decided to stop its bond-buying stimulus program, which has helped the economy emerge from its debt crisis four years ago, at the end of this year. Draghi said rising wages gave the bank confidence it would meet its goal of keeping inflation near its target of just under 2 percent even after the bond purchase stimulus ends. Still, some investors are worried Europe is facing mounting economic headwinds.

On the trade front, U.S.-China trade tensions are easing. White House trade policy advisor Peter Navarro told FOX Business China has re-entered the U.S. market for soybeans. This is a positive sign for U.S. farmers and the broader U.S. agriculture economy.

TickerSecurityLastChange%Chg
GEGENERAL ELECTRIC COMPANY9.37-0.05-0.53%
AAPLAPPLE INC.217.73-3.23-1.46%

As for specific stock news, General Electric shares gained over 7 percent after JPMorgan analyst Stephen Tusa turned more positive on the embattled industrial giant after two-and-half years of being negative on the stock. Shares have lost over 60 percent of their value in the past year, as investors worry about GE's ballooning debt and a turnaround that has failed to take hold. In tech, Apple is making good on its promise to invest some of its billions back into the U.S.A. The technology giant said it will invest $1 billion to build a new campus in North Austin, Texas and another $10 billion for new data centers.

On Thursday’s economic calendar, import prices had the biggest drop in more than three years, falling 1.6 percent. Also jobless claims slipped to a near 49-year low, falling 27,000 in the past week to 206,000.

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Investors are also watching how British Prime Minister Theresa May, who survived a no-confidence vote launched by the Conservative Party that would have likely ousted her as the country's leader, handles her future and the future of Brexit, now uncertain.

Fox Business' Ken Martin contributed to this report as did The Associated Press.