U.S. stocks declined but pared some losses at the end of the trading day as investors continued to contemplate U.S.-China trade deal prospects. Earlier in the session, the Dow was off by as many as 112.75 points.
Here’s where the markets settled Thursday at the end of regular equity trading:
S&P 500 (^GSPC): -0.16%, or 4.92 points
Dow (^DJI): -0.2%, or 55.8 points
Nasdaq (^IXIC): -0.24%, or 20.52 points
10-year Treasury yield (^TNX): +3.1 bps to 1.769%
Gold (GC=F): -0.62% to $1,465.10 per ounce
Chinese officials invited U.S. Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin to come to China for in-person trade discussions, the Wall Street Journal reported Thursday, citing unnamed people brief on the matter.
While it remains unclear whether Lighthizer and Mnuchin accepted the offer, U.S. negotiators have suggested a willingness to meet face-to-face for another round of talks as the two sides work to come to an interim deal, the WSJ reported.
Meanwhile, China’s Ministry of Commerce said Thursday that China will continue striving to reach a phase one trade agreement with the U.S., as “this is in line with the interests of both China and the United States, and of the world,” ministry spokesman Gao Feng told media including Reuters.
Other recent events, however, underscored further complications as negotiators pace toward signing a phase one trade deal.
Late Wednesday, the U.S. House of Representatives passed legislation that supported pro-democracy protestors in Hong Kong by putting its special trade status with the U.S. under annual review and requiring that individuals found to have violated international human rights in the region be sanctioned. The chamber passed the decision by a 417-1 margin, and also unanimously passed another bill prohibiting the export of certain crowd-control munitions like tear gas to Hong Kong police.
The Senate passed both pieces of legislation, sending them to President Donald Trump for consideration.
The White House has not yet said publicly whether Trump intends to sign the bills, although he is expected to do so. The bills in support of Hong Kong protestors have drawn condemnation and unspecified threats of retaliation from China, creating what has widely been viewed as a potential new roadblock in U.S.-China trade negotiations.
STOCKS: Macy’s cuts guidance ahead of the holidays
Macy’s (M) slashed its full-year outlook heading into the key holiday shopping season, with the gloomy forecast overshadowing a beat on the bottom-line in the fiscal third quarter. Macy’s said it expects owned plus licensed comparable same-store sales to fall by 1% to 1.5% in 2019, after previously issuing guidance for 0% to 1% growth. Full-year adjusted earnings per share are expected to come in at as much as $2.77, down from previous guidance for as much as $3.05.
In the third quarter, Macy’s earned an adjusted 7 cents a share on net sales of $5.17 billion, versus a loss of a penny per share on sales of $5.3 billion expected. Comp sales, a closely monitored measure for retailers, fell 3.5%, versus a drop of 1.2% expected. Macy’s said third-quarter sales were impacted by “the late arrival of cold weather, continued soft international tourism and weaker than anticipated performance in lower tier malls,” CEO Jeff Gennette said in a statement. The company also experienced a temporary impact in its e-commerce business to revamp the site ahead of the fourth quarter, he added.
L Brands (LB) reported weaker than expected third quarter results as a steepening decline in purchasing at Victoria’s Secret offset an increase in sales at Bath & Body Works. Overall stores and direct comparable sales fell 2% over last year, versus a 1% decline expected. Comp sales slumped 7% at Victoria’s Secret, versus a 4.7% decline expected, while Bath & Body Works’ comps jumped an estimates-topping 9%.
Adjusted earnings of 2 cents a share were in-line with Wall Street’s expectations, while net sales of $2.68 billion were short of the $2.69 billion anticipated. L Brands expects adjusted EPS will be $2.40 for the year, narrowing its guidance after previously offering a range of between $2.30 to $2.60 a share.
The results, delivered after market close Wednesday, came just after Fox Business reported the struggling retailer would be coming under pressure from activist shareholders for a corporate restructuring, which could see the ousting of founder and CEO Leslie Wexner.
Charles Schwab (SCHW) is buying peer brokerage TD Ameritrade (AMTD) for $26 billion, Fox Business reported Thursday morning, citing unnamed sources familiar with the matter. The new company will reportedly be run by Schwab CEO Walter Bettinger, and would have around $5 trillion in combined assets under management.
Charles Schwab and TD Ameritrade have each recently adopted zero commission trades, a decision which Schwab said would cut quarterly revenue by as much as $100 million, and which TD Ameritrade said would reduce quarterly sales by as much as $240 million.
ECONOMY: Jobless claims come in higher than expected last week
Weekly jobless claims were at a seasonally adjusted level of 227,000 for the week ended Nov. 16, the Department of Labor reported Thursday. This was unchanged from the week prior’s level, which was upwardly revised after previously being reported at 225,000.
Consensus economists had expected weekly unemployment claims would fall to 218,000 for the week, according to Bloomberg data. The new totals bring the four-week moving average for unemployment claims up by 3,500 from last week to 221,000.
Continuing unemployment claims rose more than expected for the week ended Nov. 9 to 1.695 million. This was above expectations for 1.683 million, and the week prior’s upwardly revised level of 1.692 million.
The Philadelphia Fed’s Manufacturing Business Outlook Survey showed manufacturing activity jumped in the region in November in another sign of modest recovery for the struggling sector.
The headline regional manufacturing activity index index clocked in at 10.4 in November, well above October’s print of 5.6 and the reading of 6.0 expected. Indices measuring future activity suggested firms remained optimistic about growth for the next six months, although other metrics showed current shipments and new orders each declined during the month.
Existing home sales jumped in October as sales increased in the Midwest and South but dropped in the Northeast and West, the National Association of Realtors said Thursday.
Total existing home sales rose 1.9% to a seasonally adjusted annual rate of 5.46 million during the month, or just short of the 5.49 million expected, according to Bloomberg consensus data. This marked a rebound after existing home sales fell by a downwardly revised 2.5% to 5.36 million in September.
“Historically-low interest rates, continuing job expansion, higher weekly earnings and low mortgage rates are undoubtedly contributing to these higher numbers,” Lawrence Yun, chief economist for NAR, said in a statement. “We will likely continue to see sales climb as long as potential buyers are presented with an adequate supply of inventory.”
The Conference Board’s leading economic index fell by 0.1% in October, matching expectations and declining for a third straight month. The index, which serves as a gauge for future economic movements, fell for the month on account of weakness in manufacturing new orders, average weekly hours and unemployment insurance claims, the Conference Board said. In September, the LEI fell by 0.2%, downwardly revised from a 0.1% drop reported previously.
“The major difference this month is the softening in the labor market, whereas conditions in manufacturing remain weak and show no signs of improvement yet,” Ataman Ozyildirim, senior director of economic research for The Conference Board, said in a statement. “Taken together, the LEI suggests that the economy will end the year on a weak note, at just below 2 percent growth.”
Emily McCormick is a reporter for Yahoo Finance. Follow her on Twitter: @emily_mcck
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