Stocks close first day of 2015 mixed: Dow up, S&P dips
Stocks bounced around on the first day of trading in 2015 and closed mixed as the Dow posted small gains but the S&P 500 and Nasdaq fell.
An early morning rally that saw the Dow jump more than 100 points evaporated after two disappointing economic reports showed manufacturing and construction activity slowed. That sent stocks tumbling. But investors cut their losses late in the trading session and managed to put the Dow back into positive territory.
The Dow Jones industrial average rose 10 points, or 0.1%, to 17,833. The Standard & Poor's 500 index fell 1 point, or less than 0.1%, to 2058 and the Nasdaq composite index dropped 9 points, or 0.2%, to 4727.
Signs of a slowdown in manufacturing growth weighed on investor sentiment:
• U.S. factory activity grew at the slowest pace in six months in December. The Institute for Supply Management, a trade group of purchasing managers, says its manufacturing index fell to 55.5 in December from 58.7 in November.
• The Commerce Department reported that construction spending slipped 0.3% in November, after having climbed 1.2% in October.
Markets have a tough act to follow after three consecutive years of 10%-plus gains on Wall Street. But experts are optimistic about 2015 and predict another year of gains on Wall Street as the economic recovery solidifies, despite concerns about the age of the bull market and the possibility the Fed will begin to implement rate hikes later in the year.
The average 2015 year-end target, collected by Paste BN from 15 S&P 500 firms, equates to 8.3% gains for stocks.
Oil prices fell Friday as the benchmark U.S.crude fell 60 cents to $52.66 a barrel. The yield on the 10-year Treasury note fell to 2.12% from 2.17% on Wednesday.
OIL: Crude suffers worst price drop since 2008
In Asia, Hong Kong's Hang Seng index enjoyed a strong start to the new year, gaining 252.78 points, or 1.1%, to close at 23,857.82. Japanese markets and the Shanghai composite were closed for New Year holidays.
European benchmarks saw a lower start to 2015, with Britain's FTSE 100 down 0.3% to 6547.80 and France's CAC-40 dropping 0.5% to 4252.29. Germany's DAX was down 0.4% to 9764.73.
The euro retreated against the dollar after European Central Bank President Mario Draghi indicated the bank could soon back further monetary stimulus.
Stocks closed lower Wednesday as Wall Street closed the book on a very strong 2014.
In 2014, every type of stock index – ranging from the blue-chip Dow (up 7.5%) to the tech-packed Nasdaq composite (up 13.4%) to the broad-based S&P 500 (up 11,4%) – finished in the black.
Contributing: Adam Shell; The Associated Press
What does 2015 have in store for the markets? Check out Paste BN's 2015 Investment Roundtable: