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US STOCKS-Wall St struggles for direction in rocky start to 2019

(For a live blog on the U.S. stock market, click LIVE/ ortype LIVE/ in an Eikon news window.)

* All 3 major stock indexes overcome early losses

* Energy stocks rise as crude prices jump

* Weak China, Euro zone factory data spark growth concerns

* Dow down 0.24 pct, S&P up 0.05 pct, Nasdaq up 0.49 pct (Updates to late afternoon, changes dateline, byline)

By Stephen Culp

NEW YORK, Jan 2 (Reuters) - Wall Street struggled fordirection after stumbling out of the starting gate on Wednesdayas investor fears over a global economic slowdown dampened thespirit of bargain hunters on the first trading day of the newyear.

Consumer discretionary stocks pulled the S&P and the Nasdaqinto positive territory, while healthcare companies weighed onthe Dow.

Healthcare .SPXHC and so-called defensive sectors, such asreal estate .SPLRCR and utilities .SPLRCU , provided thebiggest drag to the S&P 500.

The session got off to a rocky start after separate reportsshowed a deceleration in factory activity in Chinaurn:newsml:reuters.com:*:nL3N1Z20MWand the euro zone

As 2019 gets under way and with the worst year for U.S.stocks in a decade in the rear-view mirror, some analysts see a"January effect" attracting investors to the table.

"We had a lousy quarter and the negative returns for theyear," Said Bucky Hellwig, senior vice president at BB&T WealthManagement in Birmingham, Alabama. "However, we could see a morefriendly Fed than what we had last year and we could see somemovement on the trade talks."

"Stocks are cheap and investors are looking to put money towork in the new year," Hellwig added.

The Dow Jones Industrial Average .DJI rose 20.04 points,or 0.09 percent, to 23,347.5, the S&P 500 .SPX gained 8.71points, or 0.35 percent, to 2,515.56 and the Nasdaq Composite .IXIC added 53.58 points, or 0.81 percent, to 6,688.85.

Of the 11 major sectors in the S&P 500, six were in positiveterritory.

Energy .SPNY stocks enjoyed the largest percentage gain inthe S&P 500, buoyed by a 1.7-percent jump in crude prices. Thegroup was the worst performing S&P sector in 2018.

Banks got a boost from Barclays, when the broker wrote in aresearch note that the sector could outperform the S&P thisyear.

Tesla IncTSLA.O delivered fewer-than-expected Model 3sedans in the fourth quarter and cut U.S. vehicle prices due toa loss of a green tax credit.

General Electric CoGE.N jumped 6.6 percent in heavytrading as bargain hunters bought the stock in the wake of its56.6-percent plunge in 2018.

In the coming weeks, the fourth-quarter reporting periodwill be underway. Analysts see S&P 500 companies posting profitgains of 15.8 percent, significantly smaller than the thirdquarter's 28.4 percent advance.

Investors look to Thursday's PMI report on U.S. factoryactivity, and the Labor Department's payrolls data on Friday,for signs of cracks in what has been a fairly robust U.S.economy.

The U.S. federal government shutdown entered its 12th day onthe eve of Democrats taking the helm of the U.S. House ofRepresentatives, raising the specter of a possible spendingimpasse in congress as lawmakers wrestle over funding for theU.S.-Mexico border wall.

Advancing issues outnumbered declining ones on the NYSE by a1.98-to-1 ratio; on Nasdaq, a 1.99-to-1 ratio favored advancers.

The S&P 500 posted no new 52-week highs and 3 new lows; theNasdaq Composite recorded 9 new highs and 58 new lows. (Reporting by Stephen CulpEditing by Nick Zieminski) ((stephen.culp@thomsonreuters.com; 646-223-6076;))


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Reuters

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