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* Stock market to be shut for Labor day on Monday
* Ulta Beauty tumbles on full-year forecast cut
* U.S. consumer spending increases strongly, sentiment drops
* Dow up 0.16%, S&P up 0.06%, Nasdaq down 0.13%
(Updates with closing prices, adds commentary)
By Sinéad Carew
NEW YORK Aug 30 (Reuters) - Wall Street ended the week with
a lackluster session on Friday as investors were cautious ahead
of a holiday weekend in which a fresh round of U.S. tariffs on
Chinese imports were due to be levied.
While the S&P 500 .SPX registered its biggest weekly gain
since June, August had its biggest monthly decline since May.
Investors had fled risky assets in August due to escalations in
the U.S.-China trade war and the inversion of a key part of the
U.S. yield curve which is often a recessionary signal.
U.S. financial markets were due to stay closed on Monday for
the Labor Day holiday and a new round of U.S. tariffs on some
Chinese goods were expected to come into effect on Sunday.
Trading volume was light as and the S&P swapping between
negative and positive territory in the afternoon to end the day
with little progress.
"People are becoming more defensive going into the weekend
because we have three days where we can't react to news and it's
three days that have a lot of uncertainty associated with them
because of the tariffs," said Robert Phipps, a director at Per
Stirling Capital Management in Austin, Texas.
"Right now everything is evolving around the trade complex
and probably will for the remainder of this year," he said.
The United States and China had given hopeful signs on trade
on Thursday as they discussed the next round of in-person
negotiations in September. But Randy Frederick, vice president of trading and
derivatives for Charles Schwab (NYSE:SCHW) in Austin, urged caution saying:
"Frankly, markets have been overly optimistic about trade."
The Dow Jones Industrial Average .DJI rose 41.03 points,
or 0.16%, to 26,403.28, the S&P 500 .SPX gained 1.88 points,
or 0.06%, to 2,926.46 and the Nasdaq Composite .IXIC dropped
10.51 points, or 0.13%, to 7,962.88.
Since bonds have recently outperformed stocks, investors may
have taken early action to rebalance their portfolios for the
end of the month due to the long weekend, according to Vinay
Pande, head of trading strategies at UBS Global Wealth
Management in New York.
U.S. consumer spending increased solidly in July as
households bought a range of goods and services. While this
could allay financial market fears of a recession, a survey from
the University of Michigan, also out Friday, showed its consumer
sentiment index in August dropping by the most since December
2012, amid nerves over the U.S.-China trade war. "The news today has been mixed. There was positive news
about consumption data and negative news on consumer
confidence," said Pande.
The Consumer Discretionary sector .SPLRCD was the S&P's
biggest drag as Ulta Beauty Inc ULTA.O , which had been the
S&P's top performing stock in Wall Street's decade-old bull
market, tumbled 29.6% after the cosmetics company cut its
full-year profit forecast.
One of the biggest percentage gainers on the benchmark index
was Campbell Soup Co CPB.N , which jumped 3.9% after its
quarterly profit beat estimates. Advancing issues outnumbered declining ones on the NYSE by a
1.38-to-1 ratio; on Nasdaq, a 1.05-to-1 ratio favored advancers.
The S&P 500 posted 36 new 52-week highs and no new lows; the
Nasdaq Composite recorded 37 new highs and 62 new lows.
Volume on U.S. exchanges was 5.77 billion shares, compared
with the 7.13 billion average for the last 20 trading days.