The S&P 500 ended a five-day winning streak on Wednesday as investors’ optimism about global economic growth was countered by a steep drop in FedEx Corp shares, but the benchmark index managed to hover near all-time highs.
Canada’s main stock index fell in a broad-based decline, despite a surge in shares of SNC-Lavalin. The S&P/TSX composite index closed down 43.22 points at 17,031.98.
FedEx shares tumbled 10% after the U.S. parcel delivery company cut its fiscal 2020 profit forecast on heavy expenses, slowing global trade and fallout from its breakup with Amazon.com Inc.
The decline in FedEx shares weighed on the blue-chip Dow industrials. Shares of rival package delivery company United Parcel Service Inc fell 1.9%. The FedEx and UPS losses sent the Dow Jones Transport Average down 0.9%.
But the Nasdaq notched a record closing high for a fifth straight session.
Even with Wednesday’s nominal losses on the S&P 500, analysts said market sentiment remained largely upbeat following last week’s announcement of an initial U.S.-China trade agreement. Earlier in the session, the S&P 500 hit its fifth consecutive record high.
“Investors have gotten much more comfortable with the path of things that have been dark clouds over the market,” said Wayne Wicker, chief investment officer at Vantagepoint Investment Advisers in Washington. “This is just somewhat of a pause after having such a strong run.”
The market largely shrugged off the likely impeachment of U.S. President Donald Trump as the House of Representatives geared up for a historic vote later in the day on two charges accusing Trump of abusing his power and obstructing Congress.
Impeachment would have little effect on the factors most influential on U.S. markets, said Shannon Saccocia, chief investment officer at Boston Private. “It doesn’t change what the Fed does,” she said. “It doesn’t change what happens from a China perspective.”
The Dow Jones Industrial Average fell 27.88 points, or 0.1%, to 28,239.28, the S&P 500 lost 1.38 points, or 0.04%, to 3,191.14, and the Nasdaq Composite added 4.38 points, or 0.05%, to 8,827.74.
The small-cap Russell 2000 hit its highest level in 14 months and ended 0.25% higher.
Facebook Inc shares rose 2.1%, providing the biggest boost to the S&P 500, as Deutsche Bank raised its price target on the stock.
Most sectors in Toronto closed with losses, including energy falling 0.2 per cent, banks losing 0.8 per cent, and the health-care index - which includes many cannabis stocks, dropping 3 per cent.
Shares in SNC closed up 19 per cent after a division of the Canadian engineering company settled criminal fraud charges with a guilty plea and an agreement to pay a $280-million fine, removing uncertainty that had been hanging over the stock for the past 18 months.
As recently as September, the shares traded as low as $15.47, down 75 per cent since mid-2018, implying that the company’s value was in its ownership stake in Ontario’s Highway 407 ETR and that its international engineering and construction business – which underpinned SNC’s 110-year history – was worthless.
Now, observers believe the company’s future has brightened.
“While the guilty plea may result in some short-term uncertainty, we believe this should be outweighed by the positive impact of the settlement,” Benoit Poirier, an analyst at Desjardins Securities, said in a note.
Reuters, Globe staff, Canadian Press