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Stocks mixed as Dow drops for 4th straight day

Stan Choe
AP Business Writer
Traders react on the floor of the New York Stock Exchange (NYSE) at the Opening Bell in New York, January 12, 2017.

NEW YORK - U.S. stock indexes closed mixed Wednesday as the S&P 500 entered its most listless stretch of trading in more than three years. Bond yields and the dollar resumed their moves higher.

The Dow Jones industrial average fell 22.05 points, or 0.1%, to 19,804.72 as the blue-chip index notches its fourth straight day of losses.

The Standard & Poor’s 500 index rose 4.00 points, or 0.2%, to 2271.89. Wednesday is the ninth straight day where the index has swung by less than 0.4%, up or down. The last time that happened was in July 2013.

The Nasdaq composite gained 16.93, or 0.3%, to 5555.65.

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Benchmark U.S. crude oil fell $1.40 to settle at $51.08 a barrel. Brent crude, the international standard, fell $1.55 to close at $53.92.

Stocks have been in a wait-and-see period in recent weeks following their torrid run since Election Day. The S&P 500 is up 6% since Donald Trump’s surprise victory of the White House, driven higher by expectations for lower corporate taxes and less regulation. Trump will take the oath of office on Friday, and investors are waiting to see how much he and the Republican-led Congress will change policies.

One notable area of weakness in the stock market was retail. This past holiday shopping season was weaker than many were expecting, and Target became the latest to cut its forecast for fourth-quarter sales and profits as a result. The discounter said that traffic levels at its stores were disappointing in November and December, and its stock 5.7% following its announcement.

Target slumps after disappointing holiday season

Target had one of the biggest losses in the S&P 500, while Macy’s, Dollar Tree and other retailers weren’t far behind.

Treasury yields rose, and the yield on the 10-year Treasury climbed to 2.41% from 2.33% late Tuesday. It more than made up its loss from the prior day, and it continues the steady march higher that bond yields have been on since Election Day. Expectations of higher inflation, along with faster economic growth, have driven the trend.

Consumer prices last month were 2.1% higher than the same time a year earlier. Economists say the inflation rate is still relatively modest, but it’s a clear acceleration from the very low levels of the last four years.

Higher rent, gas pushes inflation to 2-year high

The Federal Reserve has raised interest rates twice in the last two years, up from their record low of nearly zero. The central bank has said that it plans for a gradual rise in rates, but a big push higher in inflation could force its hand.

In Asia, Japan’s Nikkei 225 index rose 0.4% and Hong Kong’s Hang Seng jumped 1.1%. South Korea’s Kospi index dipped by 0.1%.

In Europe, Germany’s DAX rose 0.5%, and the U.K. FTSE 100 rose 0.4%, while France’s CAC 40 fell 0.1%.

AP Business Writer Kelvin Chan contributed to this report from Hong Kong.

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