Early gains fade as U.S. stocks veer lower in afternoon trade

Randall Padilla
January 17, 2018

UnitedHealth Group gained 2.4 percent after its said earnings more than doubled in the final quarter of 2017.

"The gains have been made thanks to optimism over the Republican tax cut bill and hopes it will boost corporate profits and provide a fresh spark to the economy", Cohen said.

In late afternoon trading, the Dow Jones Industrial Average had lost momentum and was down 0.11 per cent at 25,775.87. The Russell 2000 index of smaller-company stocks gave up 16 points, or 1 percent, to 1,575.

Stocks are opening higher on Wall Street as investors return from a long holiday weekend, sending the Dow Jones industrial average above 26,000 for the first time.

The Standard & Poor's 500 index fell 5 points, or 0.2 percent, to 2,780 as of 3:29 p.m.

The blue chip FTSE 100 index ended down 0.17 per cent at 7,755.93 points, retreating further from a record set last week and slightly underperforming the broader European market.

E-mini Dow Jones Industrial Average
Daily March E-mini Dow Jones Industrial Average

"Not only is the USA coming off a strong quarter, but the new tax reform measures are continuing to provide a boost, with investors keen to hear more about what impact this will have on future earnings", said Craig Erlam, senior market analyst at online foreign exchange broker Oanda.

General Motors rose 2.7 percent after the company said it expected earnings in 2018 to be largely flat, compared with 2017, but that profits should pick up pace in 2019. On the Nasdaq, 1,958 issues rose and 673 fell. Traders bid up shares in the drugmaker after it announced positive results from a clinical trial for a lung cancer treatment.

Weaker Brent crude prices also weighed on the energy sector, while a slide in copper prices pulled BHP Billiton, Glencore, Rio Tinto and Anglo American down by between 1.4 and 3 per cent. Range Resources was down 88 cents, or 5 percent, to $16.70. The U.S. currency was down to 110.37 yen from 110.52 yen on Monday.

Benchmark 10-year notes last rose 2/32 in price to yield 2.5462 percent, from 2.552 percent late on Friday.

And stocks' record-breaking rise is likely not over, market analysts say.

Frankfurt's DAX rose 0.35 per cent to 13,246.33.

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