The Nasdaq squeaked out a record high close on Thursday thanks to Amazon.com, while deep drops in Macy’s, Kohl’s and other department stores weighed on the broader stock market.
US stocks have wavered over the past three weeks following a strong surge in the wake of the November election, with investors expecting President-elect Donald Trump to stimulate the economy through tax cuts and infrastructure spending.
Many on Wall Street want evidence that his campaign-trail promises will be approved by Republican lawmakers and come to fruition.
“The market is pausing for a reason, it’s waiting for confirmation from Washington and the Trump agenda,” said JeffZipper, managing director for investments at Private Client Reserve at US Bank in Palm Beach, Florida.
Department stores Macy’s dropped 13.89 per cent, while Kohl’s slumped 19.02 per cent after the companies said their holiday sales fell more than expected.
The warnings swept up other department stores in their wake- Nordstrom fell 6.87 per cent and J.C. Penney fell 7.20 per cent.
But online retailer Amazon.com , which has been luring customers away from department stores, rose 3.07 per cent, helping push the Nasdaq Composite to a record high close.
The Nasdaq Composite rose 0.2 per cent to end at5,487.94, less than 1 point higher than its previous record high close on December 27.
The Dow Jones Industrial Average lost 0.21 per cent to end at 19,899.29, while the S&P 500 lost 0.08 per cent to 2,269.
Six of the 11 major S&P 500 sectors fell, with financials down 1.02 per cent and hurt by JPMorgan, Wells Fargo and Bank of America.
Adding to downbeat sentiment was the ADP National Employment report, which showed fewer jobs than expected were added in the private sector in December.
The report was seen as a hint ahead of Friday’s more comprehensive non-farm payrolls report that includes both private and public sector hiring.
Broadly, the economy is seen by many economists as near full employment, a factor that may help corporate profits - and stock prices - as fourth-quarter earnings season starts in the next few weeks.
“If we get a 5- or 10-percent pullback here, most people will be buying, because the fundamental backdrop is still pretty good, and getting better. This is probably the best economic environment for a new incoming president in 20 years,” said JohnCanally, chief economic strategist for LPL Financial.
Declining issues outnumbered advancing ones on the NYSE by a1.27-to-1 ratio; on Nasdaq, a 1.46-to-1 ratio favoured decliners.
The S&P 500 posted 17 new 52-week highs and no new lows; the Nasdaq Composite recorded 86 new highs and 15 new lows.
About 7.2 billion shares changed hands in US exchanges, more than the 6.8 billion daily average over the last 20 sessions.