S&P, Nasdaq dragged lower by tech; Dow hits record close
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The S&P 500 and the Nasdaq rose in morning trade on Friday, lifted by gains in consumer staples and utility stocks, while the Dow was weighed down by declines in bank shares.
Industrial and banks stocks have been the biggest gainers of a post-election rally as investors expect these sectors to benefit the most from President-elect Donald Trump's policies.
In contrast, shares of utilities and technology companies have largely struggled.
Since Nov. 8, the S&P 500 utilities index .SPLRCU and the consumer staples index .SPLRCS have been the worst performers, falling over 4.5 percent.
Financials .SPSY have risen 13 percent, while industrials .SPLRCI 7.5 percent.
However, fortunes changed on Friday, with the defensive utilities rising 1.3 percent and staples up 0.7 percent, boosting the S&P 500 index.
"After the initial enthusiasm, the market takes a break and we're beginning to see a consolidation in which you are going to get choppy, erratic movements," said Andre Bakhos, managing director at Janlyn Capital, in Bernardsville, New Jersey.
Financials fell 0.87 percent, which Bakhos attributed to profit taking.
A report from the U.S. Labor Department showed 178,000 jobs were added in the public and private sectors in November, compared with economists' expectation of 175,000. Unemployment rate dropped to a more than nine-year low of 4.6 percent.
However, investor reaction to Friday's report was muted as the markets have already priced in a rate hike in December.
Traders currently see a 92.4 percent chance of a hike this month, according to Thomson Reuters data.
Wall Street believes that the Fed is going to raise interest rates in December regardless of Friday's jobs data, given the sustained growth in the labor market, said Mark Cabana, head of U.S. short rates strategy at Bank of America Merrill Lynch in New York.
At 9:44 a.m. ET the Dow Jones industrial average .DJI was down 22.64 points, or 0.12 percent, at 19,169.29.
The S&P 500 .SPX was up 3.32 points, or 0.15 percent, at 2,194.4 and the Nasdaq Composite .IXIC was up 16.70 points, or 0.32 percent, at 5,267.81.
Seven of the 11 major S&P sectors rose, with real estate .SPLRCR in the lead with a 1.62 percent rise.
Starbucks (SBUX.O) fell 3.13 percent to $56.68 after the coffee chain operator said Howard Schultz would step down as chief executive officer.
Ulta Salon (ULTA.O) rose 6.24 percent to $273.46 after the company reported quarterly revenue above analysts' expectations.
Advancing issues outnumbered decliners on the NYSE by 1,487 to 1,169. On the Nasdaq, 1,298 issues rose and 967 fell.
The S&P 500 index showed four new 52-week highs and four new lows, while the Nasdaq recorded 29 new highs and 17 new lows.
(Reporting by Yashaswini Swamynathan in Bengaluru; Editing by Anil D'Silva)
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