Wall St retreats with earnings, Washington in view

4 mins read
Wall St retreats with earnings, Washington in view

(For a Reuters live blog on U.S., UK and European stock
markets, click LIVE/ or type LIVE/ in a news window)

* Twitter slumps after Trump’s account suspension

* Boeing falls after 737-500 jet crash

* Indexes down: Dow 0.45%, S&P 0.72%, Nasdaq 1.1%

NEW YORK Jan 11 (Reuters) – Wall Street’s main indexes
slipped from record levels on Monday as investors took some
profits as they waited for earnings season to begin and eyed
events in Washington with caution.

U.S. stocks had rallied last week as investors bet that
Democrats’ win of Georgia runoff elections would bring a higher
likelihood of a heftier fiscal stimulus package to boost the
pandemic-savaged economy.

Some investors worried stimulus may be delayed as House
Democrats introduced a resolution to impeach U.S. President
Donald Trump, accusing him of inciting insurrection following a
violent attack on the Capitol by his supporters.

But Monday’s rising U.S. Treasury yields and outperformance
in sectors such as energy and financials and suggested to Keith
Lerner, chief market strategist at Truist Advisory Services in
Atlanta, Georgia, that investors were still hopeful about
stimulus.

“After last week the market is in a little bit of a
digestion phase. Underneath the surface what you’re seeing
continue is the reflation trade,” said Lerner. “This is a
continuation of the expectation of more fiscal stimulus.”

But along with wariness about any surprises Trump’s last
nine days in office could bring, Lerner also cited uncertainty
ahead of the unofficial start of the fourth quarter earnings
season on Friday when banks such as JPMorgan report
results.

After the market’s big run up last week and in the last
trading days of 2020, it is “somewhat impressive” there isn’t
more profit taking, he said.

By 2:23 p.m. ET (1923 GMT), the Dow Jones Industrial Average
fell 138.92 points, or 0.45%, to 30,959.05, the S&P 500
lost 27.41 points, or 0.72%, to 3,797.27 and the Nasdaq
Composite dropped 145.59 points, or 1.1%, to 13,056.39.

Real Estate, down 1.8%, and Communications
Services, 1.5% lower, were the biggest percentage
decliners among the S&P’s 11 major industry indexes.

Shares of the micro-blogging site Twitter Inc down
around 7% was the biggest decliner in the communications sector
after it permanently suspended Trump’s account. But it shares
were still about 160% higher that where they traded before Trump
won the Presidential election in 2016.

Other Big Tech firms Facebook Inc, Alphabet Inc-owned
Google and Apple Inc were also declining as
they took their strongest actions yet against Trump to limit his
social media reach.

Healthcare stocks hit a record high for the fifth
straight session.

Investors are expecting guidance on the extent to which
executives see a rebound in 2021 earnings and the economy when
results and conference calls from JP Morgan, Citi
and Wells Fargo kick off earnings season.

Boeing Co was down 2% on Monday after a 737-500 jet
operated by Indonesia’s Sriwijaya Air crashed on Saturday, with
62 people on board.

Declining issues outnumbered advancing ones on the NYSE by a
1.67-to-1 ratio; on Nasdaq, a 1.22-to-1 ratio favored decliners.

The S&P 500 posted 41 new 52-week highs and no new lows; the
Nasdaq Composite recorded 160 new highs and two new lows.
(Additional reporting by Medha Singh, Devik Jain and Ambar
Warrick in Bengaluru and Echo Wang in New York; Editing by
Marguerita Choy)