Trump, trade, Fed take sheen off S&P’s longest bull run

Trump, trade, Fed take sheen off S&P's longest bull run

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(Reuters) – The S&P 500 marked its longest bull-market run with a dip on Wednesday as President Donald Trump’s political position was threatened by the legal woes of two former advisers and ahead of trade talks and the Federal Reserve’s minutes.

Traders work on the floor of the New York Stock Exchange (NYSE) in New York, U.S., August 22, 2018. REUTERS/Brendan McDermid

The index’s bull-market run turned 3,453 days old, making it the longest such streak by commonly-used definitions, and comes a day after it hit a record intraday high.

Nine of the 11 major S&P sectors fell, with the trade-sensitive industrial sector .SPLRCI down 0.71 percent ahead of Sino-U.S. trade talks. Energy stocks got a lift from higher oil prices and retailers gained on Target and Lowe’s results.

Former Trump campaign manager Paul Manafort was found guilty of tax and bank fraud charges on Tuesday evening, while Trump’s former personal lawyer Michael Cohen pleaded guilty to a range of charges and said he acted at the direction of Trump.

A trader works at his post on the floor of the New York Stock Exchange (NYSE) in New York, U.S., August 21, 2018. REUTERS/Brendan McDermid

Investors are considering whether the twin setback will hurt the Republican Party’s election prospects and widen a criminal probe that has overshadowed Trump’s presidency.

“There are some question marks on what the implications of yesterday’s news are on markets to the extent where they are slightly lower, but that’s not much of a move,” said Art Hogan, chief market strategist at B. Riley FBR in New York.

“The biggest driver in the market right now is around policy, and investors are certainly curious about what the minutes of the Fed will look like.”

The minutes of the Fed’s August policy meeting – due at 2:00 p.m. ET (1800 GMT) – are expected to reaffirm the central bank’s confidence in the economy and its commitment to future rate hikes, which Trump has been critical about.

At 9:58 a.m. EDT the Dow Jones Industrial Average .DJI was down 21.99 points, or 0.09 percent, at 25,800.30, the S&P 500 .SPX was down 4.30 points, or 0.15 percent, at 2,858.66 and the Nasdaq Composite .IXIC was down 6.61 points, or 0.08 percent, at 7,852.57.

The energy sector .SPNY rose 1.06 percent as oil prices jumped more than 2 percent.

The consumer discretionary index .SPLRCD climbed 0.33 percent after strong results from retailers.

Target (TGT.N) rose 5.5 percent after beating quarterly estimates and raising its full-year profit forecast.

Home improvement chain Lowe’s (LOW.N) surged 7.9 percent, reversing losses from before the bell, as investors took positively new Chief Executive Marvin Ellison’s moves to reduce slow-moving product lines and shed unsuccessful businesses. Rival Home Depot (HD.N) rose 1 percent.

Urban Outfitters (URBN.O) jumped 7.3 percent and furniture maker La-Z-Boy (LZB.N) surged 12.4 percent after their results topped Wall Street estimates.

Declining issues outnumbered advancers for a 1.06-to-1 ratio on the NYSE, but advancing issues outnumbered decliners by a 1.13-to-1 ratio on the Nasdaq.

The S&P index recorded 15 new 52-week highs and no new lows, while the Nasdaq recorded 51 new highs and 13 new lows.

Reporting by Shreyashi Sanyal in Bengaluru; Editing by Anil D’Silva

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