Stocks finish mixed as traders weigh weak economic data ahead of Fed speech
- Stocks finished mixed on Wednesday as investors weighed weak manufacturing data and another yield-curve inversion.
- The developments came ahead of Federal Reserve Chairman Jerome Powell's speech, which he will deliver Friday at the central bank's annual economic symposium.
- A measure for American manufacturing fell in August for the first time since 2009, adding to a growing list of economic indicators pointed toward a downturn.
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Stocks were mixed on Wednesday as investors digested weak economic data while also anxiously awaiting a speech from Federal Reserve Chairman Jerome Powell at the Jackson Hole Symposium.
Powell is expected to provide some hint of which direction the Fed plans on heading with interest rates. As of now, its appears Fed officials are split on what the US economy needs in terms of monetary policy. While some officials are advocating for further rate cuts to preempt a potential recession, others are convinced more stimulus isn't necessary at this point in time.The spread between the 10-year Treasury yield and its 2-year counterpart moved into negative territory again on Thursday, inverting a key part of the yield curve for a third time this month on economic slowdown fears.
A gauge for American manufacturing posted a contraction in August for the first time in almost a decade. IHS Markit said its preliminary measure of domestic factory activity fell to 49.9 in August, down from 51.7 in July and the weakest reading since September 2009. The slowdown in US manufacturing joins a growing list of metrics suggesting the economy could be approaching a downturn.
Still, even amid the dissenting Fed officer opinions voice Thursday, economists surveyed by Bloomberg still assign a 100% probability of a 25-basis-point rate cut at the Federal Open Market Committee's next meeting in September.
Here's a look at the major indexes as of the 4 p.m. close on Wednesday:
- The S&P 500 fell 0.05%, to 2,922.95.
- The Dow Jones Industrial Average rose 0.19%, to 26,252.24.
- The Nasdaq Composite slid 0.36%, to 7,991.39.
Shares of Boeing surged more than 4% on hopes the embattled airplane-manufacturer's 737-Max crisis could come to a close soon. A Wall Street analyst said the Federal Aviation Administration's certification flight for the model could take place in four to six weeks. The certification would be a "key milestone" in Boeing's recovery the analyst said, according to the Wall Street Journal.GameStop soared as much as 20% after famed "Big Short" investor Michael Burry told Barron's he see's upside in the struggling company. Burry said the video-game retailer's "balance sheet is actually in very good shape," and that next-generation gaming console will likely keep physical disc drives, providing a much-needed boost to GameStop's business.
Following a temporary trading pause, shares of Overstock.com spiked 17% after Patrick Byrne, the company's chief executive officer, announced his resignation. Bryne said he was "already far too controversial to serve as CEO," referencing unusual statements he made earlier this month regarding the "deep state" and the federal investigation into the 2016 presidential election.
Within the S&P 500, these were the largest gainers:
And the largest decliners:
Within the S&P 500, gains in financials, consumer staples, and real estate were offset by losses in materials, healthcare, and energy stocks.