Syria concerns dull market's rally
NEW YORK — The stock market rose modestly on Tuesday as renewed worries about a U.S.-led attack on Syria dampened an early rally.
Stocks surged in the opening minutes of trading as investors believed that a U.S. attack on Syria wasn't imminent. President Obama announced during the weekend that he would seek congressional approval for a strike.
But the early rally faded after the top Republican in Congress said he would support Obama's call for the country to take action. In the late morning, House Speaker John Boehner said the use of chemical weapons must be responded to.
“Key Republicans seem to agree with Obama on Syria,” said J.J. Kinahan, chief derivatives strategist for TD Ameritrade. “It puts us in a difficult situation as to what might happen from here.”
The Dow Jones industrial average closed up 23.65 points, or 0.2 percent, to 14,833.96. The index had climbed as much as 123 points in early trading.
The Dow was held back by Microsoft and Verizon, both of which slumped after announcing deals.
The Standard & Poor's 500 index gained 6.80 points, or 0.4 percent, to 1,639.77. The Nasdaq composite climbed 22.74 points, or 0.6 percent, to 3,612.
The stock market got an early boost from a report showing that manufacturing expanded last month at the fastest pace since June 2011. The report was better than economists had expected, according to estimates compiled by data provider FactSet.
In corporate news, CBS surged $2.40, or 2.7 percent, to $53.50 after the broadcaster and Time Warner Cable reached an agreement that ended a blackout of CBS and CBS-owned channels such as Showtime.
Other corporate news was disappointing. Microsoft fell $1.52, or 4.6 percent, to $31.88 when it announced it would acquire Nokia's smartphone business and a portfolio of patents and services. Microsoft is trying to capture a slice of the lucrative mobile computing market that is dominated by Apple and Google, and investors are concerned that Microsoft won't succeed.
Verizon fell $1.37, or 2.9 percent, to $46.01. The company agreed to pay $130 billion for Vodafone's stake in Verizon Wireless.
After a tough August, stocks may struggle to rally in September because of a string of events that could shake investors, said Randy Frederick, managing director of active trading and derivatives at the Schwab Center for Financial Research.
The S&P 500 logged its worst performance since May 2012 last month as investors fretted about when the Federal Reserve will cut its economic stimulus. The Fed's next meeting, which starts Sept. 17, is when many on Wall Street think the central bank will begin winding down its bond-buying program.
Lawmakers in Washington may throw investors a curve ball.
To keep the government running, Congress needs to pass a short-term spending bill before the fiscal year starts Oct. 1. Then there's the government's $16.7 trillion borrowing limit. Treasury Secretary Jacob Lew warned that, unless it is raised soon, the government would lose the ability to pay all of its bills by the middle of October.
Political wrangling in Washington shook financial markets in August 2011, when lawmakers fought over raising the debt ceiling. That led the rating agency Standard & Poor's to strip the United States of its triple-A credit rating.
“All these catalysts out there ... are still there,” Frederick said. “There's just not enough upside catalysts, and there's plenty of downside catalysts.”
Show commenting policy
TribLive commenting policy
You are solely responsible for your comments and by using TribLive.com you agree to our Terms of Service.
We moderate comments. Our goal is to provide substantive commentary for a general readership. By screening submissions, we provide a space where readers can share intelligent and informed commentary that enhances the quality of our news and information.
While most comments will be posted if they are on-topic and not abusive, moderating decisions are subjective. We will make them as carefully and consistently as we can. Because of the volume of reader comments, we cannot review individual moderation decisions with readers.
We value thoughtful comments representing a range of views that make their point quickly and politely. We make an effort to protect discussions from repeated comments either by the same reader or different readers.
We follow the same standards for taste as the daily newspaper. A few things we won't tolerate: personal attacks, obscenity, vulgarity, profanity (including expletives and letters followed by dashes), commercial promotion, impersonations, incoherence, proselytizing and SHOUTING. Don't include URLs to Web sites.
We do not edit comments. They are either approved or deleted. We reserve the right to edit a comment that is quoted or excerpted in an article. In this case, we may fix spelling and punctuation.
We welcome strong opinions and criticism of our work, but we don't want comments to become bogged down with discussions of our policies and we will moderate accordingly.
We appreciate it when readers and people quoted in articles or blog posts point out errors of fact or emphasis and will investigate all assertions. But these suggestions should be sent via e-mail. To avoid distracting other readers, we won't publish comments that suggest a correction. Instead, corrections will be made in a blog post or in an article.
- Florida roommates find a career in playing video games on web channel Twitch
- Company seeks to reopen coal mine in Nottingham, Washington County
- Retailers court web customers with free shipping
- Buyer’s remorse: Most mergers don’t work out for acquiring company
- Holiday shoppers expected to spend conservatively
- Stock forecast for 2015: milder gains, more bumps
- Westinghouse to construct colossal nuke plant in Turkey
- Butler County firm Deep Well Services tackles tough gas wells
- CEOs in 10 big mergers to get $430M: Equilar study
- Lower gasoline prices fail to spur consumer spending
- Westmoreland County’s Excela Health rethinks patient debts