Wall Street ends solid 2016 on dour note
NEW YORK – U.S. stocks slumped on the last trading day of the year on Friday, led down by Apple and other big tech stocks, but major indexes still posted solid gains in 2016.
In subdued holiday trading, the S&P 500 declined for a third consecutive session.
But the benchmark index still tallied an annual gain of 9.5 percent. The Dow Jones Industrial Average climbed 13.4 percent for 2016, even as it recorded its first weekly decline since the U.S. election on Nov. 8.
Stocks stalled this week after surging in the wake of Donald Trump’s presidential election. Investors have bet Trump will cut taxes and regulations and introduce fresh economic stimulus.
“It’s been such a significant run-up that there’s been a pause,” said Bucky Hellwig, senior vice president at BB&T Wealth Management in Birmingham, Alabama. “We are to the point now where there’s uncertainty with regard to what policies are implemented, when are they implemented and how are they going to affect the economy as a whole and industries specifically.”
The Dow Jones Industrial Average .DJI fell 57.18 points, or 0.29 percent, to 19,762.6, the S&P 500 .SPX lost 10.43 points, or 0.46 percent, to 2,238.83 and the Nasdaq Composite .IXIC dropped 48.97 points, or 0.9 percent, to 5,383.12.
The Dow slipped further from the 20,000 milestone, after coming within 13 points of the mark but not yet breaching it.
The Dow is now up about 8 percent since the election.
“It’s been quite a rally, so not surprised to see some profit taking,” said Tim Ghriskey, chief investment officer with Solaris Asset Management in New York.
“There might be some reality setting in that a lot of this rally is based on assumptions of stimulus legislation occurring, and it’s really the market’s hope that those actions occur and that there isn’t a heated battle and a water down of some of these indicated proposals by the soon-to-be new administration,” Ghriskey said.
Apple (AAPL.O) shares fell 0.8 percent after a report that the company will trim iPhone production. Shares of Apple suppliers such as Cirrus Logic (CRUS.O) and Qualcomm (QCOM.O) also declined.
Tech was the worst-performing major S&P sector, falling 1 percent. Big tech names such as Microsoft (MSFT.O) and Alphabet (GOOGL.O) slumped more than 1 percent.
Investors are wary that the market could be primed for a spill to start 2017, after the S&P 500 posted a surprisingly strong gain in 2016.
In other corporate news, OPKO Health (OPK.O) shares fell 18.8 percent after the company said its experimental drug for growth hormone deficiency in adults failed to provide a statistically significant benefit in a late-stage study.
About 5.6 billion shares changed hands in U.S. exchanges, below the 6.8 billion daily average over the last 20 sessions.
Declining issues outnumbered advancing ones on the NYSE by a 1.23-to-1 ratio; on Nasdaq, a 1.49-to-1 ratio favoured decliners.
The S&P 500 posted 1 new 52-week high and 1 new low; the Nasdaq Composite recorded 58 new highs and 48 new lows. -Reuters