A trader reacts under the curve of the German stock index at the exchange in Frankfurt on Wednesday, Sept. 12, after the top German court rejected calls to block a permanent euro zone rescue fund.Michael Probst/The Associated Press
North American stocks ended the day little changed on Tuesday, taking another breather after U.S. indexes rallied to multiyear highs last week following a bold economic stimulus announcement from the Federal Reserve.
The Dow Jones industrial average closed at 13,564.79, up 11.69 points or 0.1 per cent. The broader S&P 500 closed at 1459.32, down 1.87 points or 0.1 per cent. In Canada, the S&P/TSX composite index closed at 12,422.71, down 24.15 points or 0.2 per cent.
The decline in the S&P 500 marks the second straight decline after the benchmark index had scored a wining streak of four straight days of gains, driving it to its highest level since the end of 2007. While U.S. economic data have been disappointing, investors were buoyed by efforts by the Fed to give the economic recovery a jolt with an open-ended bond-buying strategy and a longer commitment to keep its key interest rate exceptionally low.
FedEx Corp. weighed on sentiment after it reported that its fiscal first quarter earnings fell 1.1 per cent, and it also lowered its full-year earnings guidance. It now expects earnings to grow just 1.9 per cent in the current fiscal year, reflecting a weaker global economy. Despite its reputation as a bellwether stock, FedEx shares fell far harder than the rest of the market, tumbling 3.1 per cent.
National Association of Home Builders reported that confidence among U.S. homebuilders rose to its highest level since April 2006. However, homebuilding stocks failed to rally. PulteGroup Inc. fell 2.3 per cent and Toll Brothers Inc. fell 1.5 per cent.
Crude oil, which fell in a mysteriously sharp way on Monday and then rebounded, fell again – suggesting that the declines might be due to a reassessment of the global economy rather than any trading error. It closed in New York at $95.30 (U.S.) a barrel, down $1.32. Among Canadian energy stocks, Suncor Energy Inc. fell 1.4 per cent and Canadian Natural Resources Ltd. fell 1.2 per cent.
David Berman