Stocks close lower as Dow posts 3rd straight monthly loss
NEW YORK -Stocks closed slightly lower on Monday as positive economic data and a series of big mergers were offset by uncertainty surrounding the election.
Investors continue to watch the day-to-day developments of the U.S. presidential election, which is slightly more than a week away. The news out late last week regarding newly found emails related to Hillary Clinton’s email practices has thrown the election’s results into more uncertainty. Over the weekend, FBI obtained a warrant to begin reviewing newly discovered emails that may be relevant to the Hillary Clinton email investigation, a law enforcement official told The Associated Press.
“The reopening of the email investigation into Hillary Clinton certainly throws a wrench into the Presidential election now just eight days away,” said John Briggs, head of fixed income strategy for the Americas at RBS, in a note to investors.
The Dow Jones industrial average fell 19 points, or 0.1%, to 18,142. The Standard & Poor’s 500 was basically flat, dropping 0.26 to 2126 and the Nasdaq composite dipped 0.97 to 5189. For the month, the Dow dropped 0.9% as the blue-chip index fell for a third straight month. The S&P 500 fell 1.9% and posted its worst monthly loss since January's 5.1% drop. The Nasdaq tumbled 2.3% for the month.
Will the Fed surprise complacent investors?
Along with the election, investors have two heavyweight events on the economic front this week: a meeting of the Federal Reserve and the October jobs report.
It’s widely expected that the Fed’s policymakers will not raise interest rates so close to the election, waiting until the December meeting to raise rates, however any economic observations from the bank will be important to investors. The jobs report will be the last major piece of economic data out before the Nov. 8 election.
Friday's jobs report will be key to Fed interest rate plans
Wall Street got another wave of mega mergers. General Electric (GE) announced it would merge its oil and gas division with Baker Hughes (BHI), creating a new company with $32 billion in revenue a year. GE fell 0.2% while Baker Hughes dropped 7.4%
Separately, telecommunications company CenturyLink (CTL) announced it was purchasing competitor Level 3 Communications (LVLT) for $24 billion. CenturyLink fell more than 12% and Level 3 rose 4.5%. Earlier this month AT&T announced it would buy Time Warner for $80 billion.
The wave of mergers was not limited to the U.S. On Monday three of Japan’s largest shipping companies announced they would merge their shipping container operations.
Oil prices fell as U.S. benchmark crude fell $1.55 to $47.15 a barrel in New York.
U.S. government bond prices rose slightly, sending the yield on 10-year Treasury note down to 1.83% from 1.85% on Friday. The dollar rose against the euro, British pound and the Japanese yen.
In Europe, France’s CAC 40 was down 0.9% while Germany’s DAX fell 0.3%. Britain’s FTSE 100 lost 0.6%.
Japan’s benchmark Nikkei 225 index lost 0.1% and South Korea’s Kospi fell 0.6%. Hong Kong’s Hang Seng gave up its gains to end 0.1% while the Shanghai Composite Index in mainland China fell 0.1%. Australia’s S&P/ASX 200 added 0.6%.
AP reporter Eric Tucker contributed to this report from Washington.