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Wall Street muted as Apple overshadows positive trade deal cues

Credit: REUTERS/Lucas Jackson

Wall Street's main indexes slipped on Tuesday following a three-day rally as a drop in Apple shares overshadowed optimism from remarks made by U.S. and China officials in pledging firm commitment to a Phase One trade deal.

By Medha Singh and Devik Jain

Aug 25 (Reuters) - Wall Street's main indexes slipped on Tuesday following a three-day rally as a drop in Apple shares overshadowed optimism from remarks made by U.S. and China officials in pledging firm commitment to a Phase One trade deal.

The benchmark S&P 500 opened at a record high as the news eased some concerns that the deal could be on shaky ground. Investors also anticipate the centerpiece event of the week - an annual conference of U.S. central bankers where Federal Reserve Chairman Jerome Powell is scheduled to speak.

"Both countries believe it's in their interest to cut a deal and are making noise that they don't want to let political concerns to interfere with the trade and also disrupt the world economy," said Christopher Grisanti, chief equity strategist at MAI Capital Management in Cleveland, Ohio.

The S&P 500 and the Nasdaq logged new closing highs on Monday, boosted by signs of progress in developing treatments and vaccines for COVID-19. The benchmark index surpassed its pre-pandemic high last week even as recent economic indicators signaled a bumpy recovery from the virus-led downturn.

A survey from the Conference Board showed U.S. consumer confidence unexpectedly fell in August to hit a six-year low.

Among stocks, Salesforce.com Inc CRM.N, Amgen Inc AMGN.O and Honeywell International Inc HON.N climbed between 2.9% and 5% on news they would join the blue-chip Dow Jones Industrial Average index .DJIA on Aug. 31.

Cloud computing heavyweight Salesforce.com is also expected to report second-quarter results after markets close.

The three companies will replace Exxon Mobil Corp XOM.N, Pfizer Inc PFE.N and Raytheon Technologies Corp RTX.N, which were down between 1.4% and 1.9%.

Apple Inc AAPL.O slipped 1.7%, set to snap a five-day winning streak and weighing heavily on the three main indexes.

At 10:08 a.m. ET, the Dow Jones Industrial Average .DJIwas down 85.39 points, or 0.30%, at 28,223.07, the S&P 500 .SPXwas down 1.85 points, or 0.05%, at 3,429.43. The Nasdaq Composite .IXICwas down 17.34 points, or 0.15%, at 11,362.38.

The healthcare sector .SPXHC, which got a lift from Amgen and Medtronic shares, as well as economically-sensitive financials .SPSY and industrials .SPLRCI, outperformed among the major S&P sectors.

Medtronic MDT.N rose 3.7% after the company said demand for medical devices was improving as elective surgeries picked up pace while it posted a plunge in first-quarter profit.

J.M. Smucker Co SJM.N jumped 8.3% after the Folgers coffee maker raised its forecast for fiscal 2021 adjusted profit.

Consumer electronics retailer Best Buy Co Inc BBY.N fell 7% as it warned sales growth may slow in the coming weeks.

Advancing issues matched decliners on the NYSE and outnumbered them by a 1.27-to-1 ratio on the Nasdaq.

The S&P index recorded 21 new 52-week highs and no new low, while the Nasdaq recorded 38 new highs and 12 new lows.

(Reporting by Medha Singh and Devik Jain in Bengaluru; Editing by Arun Koyyur and Bernard Orr)

((Medha.Singh@thomsonreuters.com; within U.S. +1646 223 8780, outside U.S. +91 80 6749 1130; Twitter: https://twitter.com/medhasinghs))

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

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