Monday 11.23.15 4pm EST
U.S. stocks closed mildly lower Monday as investors eyed fluctuations in oil prices and looked ahead to economic reports in the shortened Thanksgiving holiday week.
“I think part of it is we have GDP tomorrow and that has the potential to move markets around a little bit,” said JJ Kinahan, chief strategist at TD Ameritrade. He also attributed some pressure to stocks from the gains in the dollar.
The U.S. dollar index briefly hit 100 for the first time since March and continued to hold higher against major world currencies, with the euro temporarily dipping below $1.06 and the yen at 122.89 yen against the greenback in the close.
The Dow transports underperformed the major averages, closing about 0.9 percent lower.
U.S. crude settled down 15 cents, or 0.36 percent, at $41.75 a barrel after fluctuating between gains and losses. Brent held higher near $44.90 a barrel.
Earlier, crude spiked from session lows on morning reports that the Saudi Arabian cabinet reiterated the kingdom’s commitment to remain ready to work with other producing and exporting countries to stabilize prices.
European stocks ended lower, under some pressure from fluctuations in oil prices and declines in copper, which hit a multi-year low.
“If the commodity rout really exacerbates, that may weigh on stocks, but right now they should hang in,” said Jeremy Klein, chief market strategist at FBN Securities. “The Fed’s a non-issue until the jobs report.”
The Dow failed to hold higher for 2015 after closing unchanged for the year Friday. The S&P 500 and Nasdaq composite are up about 1.4 percent and 7.7 percent, respectively, year-to-date.
“I think it’s the market pausing and digesting a very strong week,” said Adam Sarhan, CEO of Sarhan Capital.
U.S. stocks rose more than 3 percent last week, with the S&P 500 posting its best week for the year so far, helped by gains in retail stocks and increasing confidence in a December rate hike.
Utilities fell more than 1 percent in afternoon trade as the greatest decliner in the S&P 500.
Consumer stocks, energy and materials led S&P 500 advancers. Alcoa closed more than 4 percent higher as the top gainer in materials. Paul Singer’s Elliott Management will disclose a 6.5 percent stake in Alcoa, sources told CNBC Monday.
Key economic reports for the week include another read on third-quarter GDP Tuesday and the Fed’s preferred gauge on inflation, the price inflation measure for personal consumption expenditures, Wednesday.
In economic news Monday, the Chicago Fed National Activity Index was minus 0.04 in October, up from minus 0.29 in September.
Existing home sales showed a decline of 3.4 percent in October.
“The crescendo of economic data is really Wednesday when we lump everything together. … There’s a lot of things that are going on overseas but we continue to climb a wall of worry,” said Art Hogan, chief market strategist at Wunderlich Securities. “Directionally there’s not much of a push here.”
The Treasury Department auctioned $26 billion in 2-year notes at a high yield of 0.948 percent, the highest since April 2010.
In other corporate news, activist investor Carl Icahn said insurance giant American International Group is “too big to succeed” and should separate into three public companies. The stock closed up nearly 0.9 percent.
CVC Capital and the Canada Pension Plan Investment Board announcedthey will acquire Petco for $4.6 billion.
Pfizer closed 2.6 percent lower after announcing it will buy Allergan for about $160 billion in the biggest deal ever in the health sector. The transaction will allow the New York-based drug giant to relocate to Ireland to cut its U.S. tax burden. Shares of Allergan ended down 3.4 percent.
The S&P 500 closed down 2.58 points, or 0.12 percent, at 2,086.59, with utilities leading six sectors lower and consumer staples leading gainers.
The Nasdaq closed down 2.44 points, or 0.05 percent, at 5,102.48.
The CBOE Volatility Index (VIX), widely considered the best gauge of fear in the market, held below 16.
Advancers were a touch ahead of decliners on the New York Stock Exchange, with an exchange volume of 863 million and a composite volume of about 3.5 billion.
Gold futures settled down $9.50 at $1,066.80 an ounce.
On tap this week:
Earnings: Brocade, Trina Solar
Earnings: Hewlett-Packard, Tiffany, Cracker Barrel, Analog Devices, Dollar Tree, Campbell Soup, Chico’s FAS, Burlington Stores, Seadrill, Signet Jewelers, TiVo, Guess, Eaton Vance, Hormel Foods
8:30 am: Q3 GDP (second)
9:00 am: S&P/Case-Shiller home prices
9:45 am: Manufacturing PMI
10:00 am: Consumer confidence
1:00 pm: $35 billion five-year auction
Earnings: Deere, Donaldson
8:30 am: Initial claims
8:30 am: Durable goods
8:30 am: Personal income
9:00 am: FHFA home prices
9:45 am: Services PMI
10:00 am: New-home sales
10:00 am: Consumer sentiment
1:00 pm: $29 billion seven-year auction
Stock market closes at 1 p.m.