U.S. Stocks Open Lower on Heels of Weaker Asia, Europe Markets
DOW JONES & COMPANY, INC. 9:58 AM ET 5/28/2015
U.S. stocks fell Thursday, pulling back one day after the Nasdaq Composite established a record high.
The Dow Jones Industrial Average fell 57 points, or 0.3%, to 18104 shortly after the opening bell. The S&P 500 declined three points, or 0.1%, to 2121. The Nasdaq Composite Index declined three points, or 0.1%, to 5104.
The decline comes on the heels of lower markets in Europe and Asia. Germany's DAX index was down 0.3%, while France's CAC-40 shed 0.6%.
Chinese stocks plummeted after brokerages announced tighter restrictions on stock trading. The Shanghai Composite fell 6.5%.
"Your big story today is Shanghai," said Phil Flynn, analyst at futures brokerage Price Futures Group in Chicago. " That seems to be wearing on sentiment."
Stocks staged a rally on Wednesday as a surge in technology stocks lifted the Nasdaq Composite Index up 1.5% to a record high close of 5106.59. The index is up 7.8% this year.
The Dow on Wednesday gained 0.7% to 18162.99, while the S&P 500 added 0.9% to 2123.48.
Stocks have been whipsawed this week as investors grapple with a mixed bag of economic data, a wave of new merger announcements and the prospect of the first interest-rate increase by the Federal Reserve in nine years as early as September. The Dow is down 0.4% so far this week, battered by its worst selloff of the month on Tuesday.
"The Fed is still signaling that rate increases are still in the cards," Mr. Flynn said.
A handful of economic reports are on tap for Thursday. Initial jobless claims rose by 7,000 to a seasonally adjusted 282,000 in the most recent week, slightly more than expected. Pending home sales for April are due at 10 a.m. EDT, with economists forecasting an increase in sales of 1%.
On Friday, investors will get a second reading on first-quarter gross domestic product. The initial reading of first-quarter GDP showed the U.S. economy slowed dramatically, growing at a sluggish 0.2%. Economists surveyed by The Wall Street Journal expect that to be revised downward to a 1% contraction in Friday's revised reading.
In commodities markets, U.S. oil futures fell 0.9% to $56.99 a barrel ahead of weekly oil inventory data due from the Energy Department. Gold futures gained 0.1% to $1192 an ounce.
The yield on the 10-year Treasury note rose to 2.144% from 2.137% on Wednesday as prices fell.
In corporate news, shares of Avago Technologies Ltd. rose 0.7% after the chip maker agreed to buy rival Broadcom Corp. for $37 billion in cash and stock. Broadcom shares eased 2.2% after soaring 22% on Wednesday.
Abercrombie & Fitch Co. shares soared 10% after the teen retailer reported a wider-than-expected loss in the first quarter but said it expects to see sales trends improve throughout the year.
Write to Dan Strumpf at daniel.strumpf@wsj.com
(END) Dow Jones Newswires
05-28-150958ET
Copyright (c) 2015 Dow Jones & Company, Inc.
“Be yourself; everyone else is already taken.”
Oscar Wilde
AI
