Little change on Wall Street on eve of US election
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Wall Street showed little change at the close of trading on Monday, reflecting uncertainty before Tuesday's US presidential election. The Dow Jones and the S&P 500 ended only very slightly down, with the Nasdaq only slightly up.
U.S. stocks ended little changed on Monday as investors picked up bargains on signs of further thawing in credit markets, but were unwilling to place big bets before the presidential election.
Cautious investors stayed on the sidelines as they were reluctant to buy equities in significant amounts ahead of an election that could play a role in the market's direction in the years ahead.
Losses were offset as the rates that banks charge each other for short-term loans fell further on Monday, extending last week's decline in response to ongoing central bank measures to supply financial institutions with cash.
In an unusually muted day, the three major U.S. stock indexes moved in a small band that was roughly a quarter of the magnitude of the swings seen since the collapse of Lehman Brothers on Sept. 15.
Telephone companies Verizon and AT&T climbed after Wachovia said the firms were safe havens in an economic slowdown. Verizon was up 3.6 percent at $30.75, and AT&T gained 3.9 percent to $27.81.
But traders noted markets were unlikely to see heavy action until after Tuesday's presidential election.
"It feels like we're in a holding pattern in front of the election and people are trying to draw out different scenarios," said John Menzies, portfolio manager at San Francisco-based investment bank Pacific Growth Equities.
"It doesn't seem like people are putting a lot of money to work today."
The Dow Jones industrial average edged down 5.18 points, or 0.06 percent, to 9,319.83. The Standard & Poor's 500 Index was off 2.45 points, or 0.25 percent, at 966.30. The Nasdaq Composite Index added 5.38 points, or 0.31 percent, to 1,726.33.
From session high to intraday low, the Dow and S&P traded in their narrowest range in two months, while the Nasdaq moved in its narrowest band since late August. The mild movements were in stark contrast to the large swings that have become typical in recent months.
Volume on the New York Stock Exchange was about 1.02 billion shares, the lowest since Aug. 29, which was the Friday before the Labor Day holiday in the United States, and the 12th-lightest day in terms of volume for the year so far. Last year's estimated daily average volume was 1.90 billion shares.
Economic concerns persisted after a report from the Institute for Supply Management showed its index of national factory activity fell to 38.9 in October, a 26-year low, from 43.5 in September. The level of 50 separates contraction from expansion.
The Nasdaq was boosted by gains in the biotech sector as Biogen climbed 8.8 percent to $46.31 after Deutsche Bank recommended a "buy" on the company. Research firm Robert W. Baird raised its view on Biogen's stock to "outperform" from "neutral."
Elsewhere in the biotech sector, Gilead Sciences rose 3.2 percent to $47.31.
General Motors fell 2.3 percent to $5.65 after it reported a 45 percent dive in U.S. sales for October, blaming the deterioration of consumer confidence.
Shares of Dow component Chevron fell 1.2 percent to $73.69 as U.S. crude oil dropped nearly $4 to settle below $64 a barrel on more ndications of eroding global demand in the face of a potential recession. An S&P index of energy companies fell 2 percent.
Goodyear Tire & Rubber Co rose 5.4 percent to $9.40 after it reported a smaller-than-expected decline in profit as a result of increased cost cutting.
Democratic contender Barack Obama heads into Tuesday's election leading Republican opponent John McCain in six of eight key battleground states, including the big prizes of Florida and Ohio, according to a series of Reuters/Zogby polls released on Monday.
Volume was also modest on the Nasdaq, with about 1.81 billion shares traded, below last year's daily average of 2.17 billion.
Advancing stocks outnumbered declining ones on the New York Stock Exchange by a ratio of about 9 to 7, while on the Nasdaq, about five stocks rose for every four that fell.
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