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Wall Street wanes ahead of holiday; Catalan vote hits euro, Spanish stocks

Published 12/22/2017, 05:51 PM
© Reuters. FILE PHOTO: Traders talk as they are seen near screens at Madrid's bourse, Spain
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By Laila Kearney

NEW YORK (Reuters) - Major global stock indexes slipped on Friday in light pre-holiday trade, exacerbated by weakness in several blue-chip companies' shares, while Spanish bond yields rose after separatists won a Catalan election.

Shoe and apparel maker Nike Inc.'s (N:NKE) shares dropped 2.3 percent after it forecast muted current-quarter revenue growth, highlighting its struggles to regain market share in North America from Adidas (DE:ADSGN).

UnitedHealth Group Inc (N:UNH) slid 0.7 percent after the health insurer agreed to buy Chilean healthcare company Banmedica SA (SN:BAN) for $2.8 billion.

Despite the dip, Wall Street ended the week higher after rallying sharply ahead of a $1.5 trillion tax cut bill that passed in Washington on Wednesday. U.S. President Donald Trump signed the tax overhaul into law on Friday.

Stock markets around the world shot up as the law, seen as boosting corporations and leading to economic growth, advanced through both chambers of the Republican-dominated Congress.

"It's been a strong week," said Mark Luschini, chief investment strategist at Janney Montgomery Scott in Philadelphia. "Whether the market is up a little bit or down a little bit is not indicative of larger trends ... It's easy to push things around when not many people are trading."

Investors were also winding down ahead of the Christmas holiday on Monday.

The Dow Jones Industrial Average (DJI) fell 28.23 points, or 0.11 percent, to close at 24,754.06, the S&P 500 (SPX) lost 1.23 points, or 0.05 percent, to 2,683.34 and the Nasdaq Composite (IXIC) dropped 5.40 points, or 0.08 percent, to 6,959.96.

MSCI's gauge of stocks across the globe (MIWD00000PUS) gained 0.02 percent.

For the week, the S&P rose 0.29 percent, the Dow added 0.42 percent and the NASDAQ gained 0.34 percent.

In Europe, the premium investors demand for holding Spanish bonds over top-rated German peers fell to its lowest in almost three months as Catalonia held an independence election.

The euro slid 0.1 percent to $1.1858 , but Europe's common currency was still up nearly 13 percent this year, on track for its best yearly performance in 14 years.

Spanish stocks were among the biggest losers, confirming analyst expectations that any shake-out from the Catalonia vote would be mostly confined to Spain.

U.S. Treasury yields, which reached a nine-month peak after the American tax vote, pushed slightly higher as investors hung up their hats before Christmas and ahead of next week's supply of short-to-medium-term government debt.

The yield curve, while mildly flatter on the day, was on track for its largest weekly steepening since July following the bill's passage, which was seen as hastening the pace of interest rate increases.

Investors appeared to brush off U.S. data on durable goods orders, personal spending, new home sales and consumer sentiment.

Next week, investors will watch for the release of December U.S. consumer confidence survey data. Economists polled by Reuters expect it to decline from its strongest levels since late 2000.

In commodities, oil prices waned in light trading but remained near their highest since 2015 on pledges from OPEC leader Saudi Arabia and non-OPEC producer Russia that any exit from crude output cuts would be gradual.

Palladium prices jumped to 17-year highs as strong demand from auto catalyst makers reinforced the prospect of market shortages, while gold rose for the sixth straight session to a 2-1/2-week high on U.S. economic data.

© Reuters. FILE PHOTO: Traders talk as they are seen near screens at Madrid's bourse, Spain

In cryptocurrencies, bitcoin (BTC=BTSP) once again became an eye-catching mover, this time because it plunged by nearly 30 percent to below $12,000, before recovering to trade above $14,000, still down nearly 9 percent. Investors dumped bitcoin in manic trading after its blistering ascent to a peak close to $20,000 prompted warnings by experts of a bubble.

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