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US Stocks Close Broadly Lower          12/09 16:26

   Stocks closed modestly lower on Wall Street Monday as losses in technology, 
health care and financial companies outweighed gains elsewhere in the market.

   (AP) -- Stocks closed modestly lower on Wall Street Monday as losses in 
technology, health care and financial companies outweighed gains elsewhere in 
the market.

   The selling snapped a three-day winning streak for the S&P 500 and wiped out 
the index's 0.2% gain last week.

   Trading was mostly muted as investors looked ahead to a busy week of 
economic reports and an interest rate policy update from the Federal Reserve. 
The market also remained focused on developments in the trade negotiations 
between the U.S. and China.

   Both sides have been working toward a limited "phase 1" deal that investors 
hope can at least avert new U.S. tariffs from kicking in on $160 billion of 
Chinese imports on Sunday. That would raise prices on key products, including 
cell phones and laptops, and threaten to affect consumers.

   "With the deadline being Sunday, most people don't think that new tariffs 
will be put in place, but they also don't expect a phase 1 (deal) to be signed 
this week," said Sam Stovall, chief investment strategist at CFRA.

   The S&P 500 index lost 9.95 points, or 0.3%, to 3,135.96. The Dow Jones 
Industrial Average fell 105.46 points, or 0.4%, to 27,909.60. The Nasdaq 
dropped 34.70 points, or 0.4%, to 8,621.83. The Russell 2000 index of smaller 
company stocks gave up 4.22 points, or 0.3%, to 1,629.62.

   Major stock indexes in Europe also closed broadly lower. 

   Bond prices rose. The yield on the 10-year Treasury fell to 1.82% from 1.84% 
late Friday.

   After strong gains in November, U.S. stock indexes have mostly pulled back 
this month ahead of the scheduled rollout of new U.S. tariffs on Chinese goods 
this weekend.

   A Chinese official said Monday that the nation wants a prompt settlement, 
but gave no details on progress toward a potential deal. China made a 
conciliatory gesture last week when it said it would waive tariffs on American 
soybeans and pork.

   Technology sector stocks, which have been particularly sensitive to 
developments on trade because many of the companies rely on China for sales and 
supply chains, helped drag the market lower Monday. Apple fell 1.4% and 
chipmaker Micron Technology slid 3.1%.

   Industrial stocks also fell. United Airlines dropped 1.1% and General 
Electric dropped 1%. Abiomed led the slide in health care stocks, falling 4%. 
Banks fell as bond yields declined. Goldman Sachs dropped 1.2%.

   Several retailers helped lift the consumer discretionary stocks sector. Home 
Depot gained 1.1% and rival Lowe's rose 1.4%. Target picked up 1.1%.

   Traders also weighed several big health care sector deals. 

   Shares in ArQule more than doubled on news that Merck agreed to buy the 
small biotechnology company for $2.7 billion. ArQule is in the early stages of 
studying potential treatments for conditions including leukemia. Merck inched 
0.1% higher.

   Sanofi made a similar play, spending $2.5 billion for Synthorx, which is 
also in the earlier stages of testing cancer treatments. Sanofi fell 1.6% and 
Synthorx jumped more than threefold.

   In other deal news, health insurer United HealthGroup said it is buying 
Diplomat Pharmacy to help bolster its pharmacy benefits unit, OptimRx. The deal 
is being made at a steep discount, which sent Diplomat's stock plunging 32.7%. 
UnitedHealth dropped 0.9%.

   PG&E vaulted 15.9% following late Friday's news that the California utility 
has reached a tentative $13.5 billion settlement that resolves all major claims 
related to the deadly, devastating Northern California wildfires of 2017-2018. 
The blazes were blamed on PG&E's outdated equipment and negligence. The deal, 
which still requires court approval, represents a key step in PG&E's exit from 
Chapter 11 bankruptcy.

   Wall Street is in for a busy week of economic reports culminating in a key 
update on whether Americans are still spending at a healthy pace.

   Investors will get a revised report on worker productivity for the 
July-September quarter on Tuesday. Data released in November showed a decline 
for the first time since late 2015. On Wednesday the government will release 
its November report for consumer prices, which have been rising at a modest 
rate this year. A gauge on producer prices will be released on Thursday.

   The Commerce Department's report on retail sales coming up Friday is 
possibly the most important update this week. The economy has been propped up 
in part by solid spending and job growth.

   Meanwhile, the Federal Reserve is scheduled to deliver its latest economic 
and interest rate policy update on Wednesday after a two-day meeting of its 
policymakers. The central bank is widely expected hold off on making any 
changes to interest rates.

   "The market does not expect a rate cut in December, but is probably still 
holding out for one or two in 2020," Stovall said. "We think the Fed is going 
to sit pat and not really do anything."

   The Fed cut interest rates three times this year in a bid to buttress 
economic growth. That nearly reversed four rate hikes in 2018. The Fed has 
signaled that it will hold off on any additional rate cuts while the economy 
remains healthy.

   Benchmark crude oil fell 18 cents to settle at $59.02 a barrel. Brent crude 
oil, the international standard, dropped 14 cents to close at $64.25 a barrel. 
Wholesale gasoline was little changed at $1.65 per gallon. Heating oil slipped 
a penny to $1.94 per gallon. Natural gas fell 10 cents to $2.23 per 1,000 cubic 
feet.

   Gold fell 20 cents to $1,464.90 per ounce, silver gained 5 cents to $16.53 
per ounce and copper rose 3 cents to $2.75 per pound.

   The dollar rose to 108.62 Japanese yen from 108.55 yen on Friday. The euro 
strengthened to $1.1064 from $1.1056.


(AG)

 
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