FILE PHOTO: Traders work on the floor at the opening bell of the New York Stock Exchange (NYSE) in New York, U.S., December 27, 2019. REUTERS/Bryan R Smith
December 31, 2019
By Manas Mishra
(Reuters) – U.S. stock indexes were set for a lackluster open on Tuesday, as a Wall Street rally fizzled out in the final days of the decade after growing trade optimism and a brightening global outlook put the S&P 500 on track for its best year since 2013.
After logging healthy gains for most of December, the three major stock indexes posted their worst day in four weeks on Monday in the absence of major updates on a U.S.-China trade truce.
The benchmark S&P 500 index closed at its lowest level since Dec. 20, shrugging off comments by White House’s trade adviser Peter Navarro that the Phase 1 trade deal was likely to be signed in the next week.
“After having a big meal, we have to digest,” said Andre Bakhos, managing director at New Vines Capital LLC in Bernardsville, New Jersey.
“We have had a strong (run) recently, and the moves (reflect) a little profit-taking and a little step back before the next phase.”
At 8:50 a.m. ET, Dow e-minis <1YMcv1> were down 33 points, or 0.12%. S&P 500 e-minis <EScv1> were down 4.25 points, or 0.13% and Nasdaq 100 e-minis <NQcv1> were down 19.25 points, or 0.22%.
Trading volumes are expected to remain thin this week in lieu of the New Year’s Day holiday on Wednesday.
The S&P 500 is on track for its best December in nine years, also driven by a loose monetary policy by the Federal Reserve and relatively upbeat economic indicators.
Latest data from China showed manufacturing activity expanded for a second straight month in December, partly driven by seasonal demand.
The data aligns with other signs of stabilization in the Asian economy, including last week’s figures that showed profits at China’s industrial firms grew at the fastest pace in eight months in November.
At home, consumer confidence data for December is expected at 10 a.m. ET.
After a year that saw many record highs, focus will shift to the latest batch of companies’ earnings reports due January for indications on the corporate outlook for 2020.
Among individual stocks, U.S-listed shares of Tencent Music Entertainment <TME.N> rose 1.1% after a consortium led by the China-based company agreed to buy a stake in Vivendi’s Universal Music Group.
(Reporting by Manas Mishra in Bengaluru; Editing by Maju Samuel)
