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* Merck, Pfizer gain on upbeat earnings
* Alphabet falls after missing profit estimates
* Fed policy announcement due Wednesday
* Dow down 0.07%, S&P 500 down 0.08%, Nasdaq down 0.59%
(Updates to market close)
By Chuck Mikolajczak
NEW YORK, Oct 29 (Reuters) - The S&P 500 edged lower to snap
a four-session win streak on Tuesday and it retreated from a
record high as investors grappled with a flood of earnings and
the latest update on a potential trade deal between the U.S. and
China.
Hopes of a U.S.-China trade deal and expectations of another
interest rate cut by the Federal Reserve when it concludes its
two-day meeting on Wednesday have pushed stocks higher the past
several sessions, sending the S&P to its second straight record
intraday high.
But indexes pulled back after a U.S. administration official
told Reuters that Washington and Beijing are continuing to work
on an interim trade agreement, but it may not be completed in
time for the leaders of the two countries to sign in Chile next
month. "It is actually impressive that we have held these gains,
even if we are down slightly, it is a pretty impressive day
considering what is going on, that there hasn't been this hard
sell-off pressure," said JJ Kinahan, chief market strategist at
TD Ameritrade in Chicago.
"The encouraging thing is we are trading more on what you
should be trading on, that being earnings, and less on rumor and
innuendo, which is a nice change of pace and how the market
should work."
Tech .SPLRCT shares, which have been closely tied to trade
progress, lost ground after the report and were last down 0.92%.
Drugmakers Merck & Co Inc MRK.N and Pfizer Inc PFE.N
both gained after reporting upbeat third-quarter results to help
keep the Dow and S&P near the flat line. The healthcare sector
.SPXHC , which has been the second-worst performer among the 11
major S&P 500 sectors this year, rose 1.16% as the best
performer on the session as Merck gained 3.5% and Pfizer
advanced 2.5%. But shares of Google parent Alphabet Inc GOOGL.O , however,
lost 2.20% and weighed on the Nasdaq as its quarterly profit
missed estimates due to higher costs. Third-quarter earnings of S&P 500 companies have largely
been better than expected, with over 77% of the 236 firms to
report so far surpassing profit expectations, according to
Refinitiv data. Still, earnings are expected to decline by 1.9%
for the quarter.
Other big names reporting this week include tech and
internet heavyweights Apple Inc AAPL.O and Facebook Inc
FB.O , as well as oil majors Exxon Mobil Corp XOM.N and
Chevron Corp CVX.N .
The focus now shifts to the Fed meeting, where the central
bank is widely expected to deliver a quarter-percentage-point
interest rate cut for the third time this year.
The Dow Jones Industrial Average .DJI fell 20.04 points,
or 0.07%, to 27,070.68, the S&P 500 .SPX lost 2.54 points, or
0.08%, to 3,036.88 and the Nasdaq Composite .IXIC dropped
49.14 points, or 0.59%, to 8,276.85.
The S&P earlier in the session reached a high of 3,047.87,
its second straight intraday record.
General Motors Co GM.N gained 4.28% after its quarterly
net profit topped estimates, but the carmaker slashed its
earnings forecast for 2019 as the 40-day U.S. labor strike by
the United Auto Workers union brought virtually all of its North
American operations to a standstill. Beyond Meat Inc BYND.O tumbled 22.22% as the vegan burger
maker said it would need to offer more store discounts amid
rising competition. Shares of GrubHub Inc GRUB.N plunged 43.30% after the
online food delivery company warned of slowing growth as
customers opted to choose from a growing pool of rival
providers. Advancing issues outnumbered declining ones on the NYSE by a
1.08-to-1 ratio; on Nasdaq, a 1.03-to-1 ratio favored decliners.
The S&P 500 posted 40 new 52-week highs and no new lows; the
Nasdaq Composite recorded 95 new highs and 69 new lows.