More volatility: US stocks wobble on another turbulent day

U.S. stocks wavered between small gains and losses Friday, struggling to maintain the momentum from a two-day winning streak following a week of volatile trading. Energy companies led a broad, late-afternoon slide. Smaller company stocks were outgaining the rest of the market.

KEEPING SCORE: The S&P 500 index fell 4 points, or 0.2 per cent, to 2,484 as of 3:29 p.m. Eastern Time. The Dow Jones Industrial Average dropped 93 points, or 0.4 per cent, to 23,045. The Nasdaq added 7 points, or 0.1 per cent, to 6,586. The Russell 2000 index of smaller-company stocks rose 10 points, or 0.8 per cent, 1,341.

On Thursday the Dow erased a 600-point loss and finished with a gain of 260 points. The swing was indicative of the volatility that has gripped the stock market throughout December. Friday has seen its own fluctuations, though less dramatic.

THE QUOTE: “It seems like convulsions in either direction have been the real norm for much of December and that’s certainly been the case this week,” said Eric Wiegand senior portfolio manager for Private Wealth Management at U.S. Bank. “The initial push higher and then seeing it subside a little bit is perhaps getting back to a little bit more of a normal environment, reflecting the reality that we have still a number of issues overhanging the market.”

VOLATILE WEEK: Volatility has been the norm in December as investors have grown worried that the testy U.S.-China trade dispute and higher interest rates would slow the economy, hurting corporate profits. The Dow has dropped 2 per cent or more in six trading sessions and had a 5 per cent gain on Wednesday. The market’s sharp downturn since October has intensified this month, erasing all its 2018 gains and nudging the S&P 500 closer to its worst year since 2008. Even with the two-day winning streak heading into Friday, the Dow, S&P 500 and Nasdaq are all down more than 9 per cent for the month and stocks are on track for their worst December since 1931.

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“The market is substantially cheaper than it was going into the fourth quarter, and we believe quite a bit of the price action we saw in the fourth quarter was more indicative of a panic and a recession,” said Janet Johnston, portfolio manager at TrimTabs Asset Management. “And that sets up a good buying opportunity.”

ENERGY: Oil prices recovered after wavering in midmorning trading. Benchmark U.S. crude rose 1.6 per cent to settle at $45.33 a barrel in New York. Brent crude, used to price international oils, inched up 0.1 per cent to close at $52.20 a barrel in London.

Despite the rise in oil prices, energy sector stocks declined. Cabot Oil & Gas slid 3.7 per cent to $22.88, while Hess lost 2.1 per cent to $40.66.

SETTLE & PAY: Wells Fargo rose 1.2 per cent to $46.06 on news that the lender has agreed to pay $575 million in a national settlement with state attorneys general over its fake bank accounts scandal. The San Francisco-based bank said in 2015 that its employees opened millions of unauthorized bank accounts for customers in order to meet unrealistic sales goals.

MORE OVERSIGHT: Tesla climbed 5.3 per cent to $332.96 after naming two independent directors to its board under an agreement with federal regulators.

HOUSING SLOWS: Homebuilders fell broadly in the morning after the National Association of Realtors said its pending home sales index fell last month as fewer Americans signed contracts to buy homes. Higher mortgage rates and prices are squeezing would-be buyers out of the market, especially in the West. The stocks mostly recovered by mid-afternoon. William Lyon Homes gained 3.4 per cent to $10.81.

BOND YIELDS: Bonds prices rose early then levelled off. The yield on the 10-year Treasury was flat at 2.74 per cent.

CURRENCY: The dollar declined to 110.41 yen from Thursday’s 110.74 yen. The euro weakened to $1.1442 from $1.1449.

METALS: Gold edged up 0.1 per cent to $1,283 an ounce and silver gained 0.8 per cent to $15.44 an ounce. Copper rose 0.5 per cent to $2.68 a pound.

MARKETS OVERSEAS: In Europe, Germany’s DAX rose 1.7 per cent and France’s CAC 40 added 1.7 per cent. London’s FTSE 100 gained 2.3 per cent. Major indexes in Asia finished mostly higher. Tokyo’s Nikkei 225 shed 0.3 per cent, while Hong Kong’s Hang Seng ended 0.1 per cent higher. Seoul’s Kospi added 0.6 per cent. India’s Sensex gained 1 per cent. Benchmarks in Taiwan, New Zealand and Singapore also rose.

Alex Veiga, The Associated Press