U.S. stocks little changed after S&P 500 reaches 5-year high
STOCKS WERE LITTLE CHANGED on Monday morning after the S&P 500 Index climbed to a 5-year high.
BLOOMBERG FILE PHOTO/SCOTT EELLS
By Lu Wang and Leslie Picker Bloomberg News
NEW YORK - U.S. stocks were little changed, after the Standard & Poor’s 500 Index climbed to a five-year high, as European leaders met to discuss the region’s crisis and investors awaited President Barack Obama’s speech on his legislative priorities.
Google Inc. declined 0.8 percent as Chairman Eric Schmidt adopted a plan to sell as many as 3.2 million shares in the operator of the world’s most popular search engine. Loews Corp. fell 0.4 percent after reporting earnings that missed estimates. AOL Inc. jumped 6.3 percent after analysts recommended investors buy the shares.
The S&P 500 fell less than 0.1 percent to 1,517.62 at 11:16 a.m. in New York. The equity benchmark last week reached its highest level since November 2007, completing its longest streak of weekly gains since August. The Dow Jones Industrial Average lost 16.80 points, or 0.1 percent, to 13,976.17 today. Trading in S&P 500 companies was 20 percent below the 30-day average at this time of day.
“With the strong start this year, it’d be very understandable if stocks pause here,” James McDonald, chief investment strategist at Northern Trust Corp. in Chicago, said by phone. His firm manages $759 billion. “The focus is going to be what the private sector can do to generate growth,” he said. “ Investors will be looking at what is the shape of the policy initiatives that are out of Washington, what will Obama focus on, and then secondly, how well Europe deals with the financial crisis.”
The S&P 500 has rallied 6.4 percent so far in 2013 as U.S. lawmakers reached a budget compromise and companies reported better-than-estimated earnings. The gauge is about 3 percent below its record high reached in October 2007. It has more than doubled since bottoming in March 2009 as the Federal Reserve conducted three rounds of bond-buying to lower interest rates and boost economic growth.
“We’re extremely overbought, but that doesn’t mean the market can’t continue higher,” T. Doug Dale, chief investment officer at Jackson, Mississippi-based Security Ballew Inc. Wealth Management, which oversees $500 million in assets, said in a telephone interview. “But investors must be wary of air pockets, as in major downturns that can happen quickly.”
Ministers from the 17-member euro area meet today in Brussels to discuss aid to Cyprus and Greece as concern over the region’s sovereign-debt crisis revives. Group of 20 finance chiefs and central bankers will gather in Moscow on Friday.