S&P, Dow flat as investors weigh impact of Harvey

S&P, Dow flat as investors weigh impact of Harvey

(Reuters) – The Dow and the S&P were unchanged in late-morning trading on Monday with losses in insurance and oil stocks offset by gains in shares of health and home improvement retail chains as investors assessed the impact of Tropical Storm Harvey.

The uncertainty pushed investors toward safe-haven assets, with U.S. Treasuries holding steady ahead of the employment data on Friday, while gold rose to its highest in more than a week.

“What it tells you is a slight risk-off trade. But nothing that is really shaking up the markets,” said Matt Lloyd, chief investment strategist at Advisors Asset Management.

Harvey – the most powerful hurricane to strike Texas in more than 50 years when it came ashore on Friday – dumped more rain on Houston on Monday, worsening the flooding that has paralyzed the country’s energy hub.

Harvey has knocked out a quarter of oil production from the Gulf of Mexico, prompting fears it could overturn years of excess U.S. oil capacity and low prices. [O/R]

U.S. crude futures CLc1, dipped 2.4 percent to $46.72 over concerns that the refinery shutdowns could reduce demand for American crude.

The energy sector’s .SPNY 0.82 percent loss led the decliners among the 11 major S&P 500 sectors.

Oil majors Exxon (XOM.N) and Chevron (CVX.N) were down about 0.5 percent. Refiner Phillips 66 (PSX.N) rose 0.44 percent and Valero Energy (VLO.N) climbed 1.20 percent.

“We’re looking at this as more of a shorter term phenomenon and the energy stocks have held in relatively well,” said Matt Miskin, market strategist at John Hancock Investments.

“The market is not seeing that as a significant move but we’ll have to see how the dynamics play out over the course of the week.”

U.S. economic growth had more than halved in the quarter after Hurricane Katrina mauled Louisiana in August 2005.

At 10:56 a.m. ET (1456 GMT), the Dow Jones Industrial Average .DJI was down 9.76 points, or 0.04 percent, at 21,803.91, the S&P 500 .SPX was up 2.74 points, or 0.11 percent, at 2,445.79.

The Nasdaq Composite .IXIC was up 24.59 points, or 0.39 percent, at 6,290.23, helped by a rise in Apple (AAPL.O) and Facebook (FB.O).

Home Depot (HD.N) was up 1 percent, while Lowe’s (LOW.N) rose 0.52 percent as investors expected the two largest U.S. home improvement chains to be among the biggest beneficiaries of post-Harvey recovery.

Insurers Travelers (TRV.N) fell 2.74 percent, dragging on the Dow, while Allstate (ALL.N) was off 1.39 percent and Progressive (PGR.N) was down 2.44 percent.

Kite Pharmaceuticals (KITE.O) soared 28.40 percent after Gilead Sciences (GILD.O) agreed to buy the immunotherapy developer in a deal valued at $11.9 billion. Shares of Gilead gained 1.87 percent.

Expedia (EXPE.O) fell 4.37 percent after an internal memo by the online travel services company said its CEO, Dara Khosrowshahi, has been asked to lead Uber [UBER.UL].

Declining issues outnumbered advancers on the NYSE by 1,452 to 1,244. On the Nasdaq, 1,387 issues rose and 1,282 fell.

Reporting by Sruthi Shankar in Bengaluru; Editing by Sriraj Kalluvila

Our Standards:The Thomson Reuters Trust Principles.

 

Published at Mon, 28 Aug 2017 15:37:17 +0000

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