McDonald's props up Dow; financial, tech stocks slip



Thu, 28 Sep 2017 - 06:00 GMT


Thu, 28 Sep 2017 - 06:00 GMT

 A McDonald's in New Delhi pictured in June: the company is to shut 169 outlets in India

A McDonald's in New Delhi pictured in June: the company is to shut 169 outlets in India

Gains in McDonald's propped up the Dow in late morning trading on Thursday, while losses in financial and technology stocks pressured the other two major Wall Street indexes.

McDonald's rose 2.5 percent, its biggest single-day percentage gain in more than 2 months, after Longbow Research upgraded the stock to "buy", saying its third-quarter comparable sales were ahead of market estimates.

The financial index was the biggest loser among the 11 major S&P sectors, falling 0.29 percent, after rising sharply on Wednesday on hopes of an interest rate hike in December.

Technology sector slipped back into the red after gaining for two straight days, with Apple's 0.85 percent fall weighing on all three indexes.

"You see the market giving back a bit from yesterday, it's taking some profits off the reflation move," said Jeff Zipper, managing director at the U.S. Bank Private Client Reserve in Palm Beach, Florida.

"There is some rotation out of technology into some of the reflation trade sectors."

Investors also assessed President Donald Trump's tax plan, which called for tax cuts for most Americans, but prompted criticism that it favored business and the rich and could add trillions of dollars to the deficit.

The Commerce Department report showed the economy grew a bit faster than previously estimated in the second quarter, but the momentum probably slowed in the third quarter as Hurricanes Harvey and Irma temporarily curbed activity.

The hurricanes also pushed up initial claims for state unemployment benefits for the week ended Sept. 23, the Labor Department said.

At 10:57 a.m. ET (1457 GMT), the Dow Jones Industrial Average was up 11.7 points, or 0.05 percent, at 22,352.41, the S&P 500 was down 0.78 points, or 0.03 percent, at 2,506.26 and the Nasdaq Composite was down 12.55 points, or 0.19 percent, at 6,440.71.

AbbVie was the biggest boost to the S&P, rising more than 6 percent, after announcing a global resolution of intellectual property-related litigation with Amgen.

Abbott also rose more than 4 percent after the U.S. FDA approved the company's glucose monitoring device.

Rite Aid slumped more than 11 percent after reporting lower-than-expected revenue mainly due to a drop in reimbursement rates and the number of prescriptions it filled.

Declining issues outnumbered advancers on the NYSE by 1,631 to 1,101. On the Nasdaq, 1,549 issues fell and 1,134 advanced.



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