Wall Street was mixed on Wednesday as investors focused on President Donald Trump’s struggle to push through a healthcare bill and worried that promised tax cuts may face similar hurdles.
U.S. stocks in the previous session had their worst day since before Trump’s election as investors worried that the president’s struggle to overhaul healthcare was a sign he would also face trouble pushing through promised corporate tax cuts that have been behind the market’s record-breaking rally since November.
Trump and Republican lawmakers appeared to be losing the support they need for controversial healthcare legislation scheduled for a vote in the House of Representatives on Thursday. Losing or delaying the vote would bruise investors’ confidence in Trump’s legislative ability and his ability to keep his big promises to business.
“If that happens, you could see a little bit of volatility in the market,” said David Schiegoleit, managing director at U.S. Bank Private Client Reserve in Los Angeles.
Apple (AAPL.O) rose 1.2 percent and provided the biggest boost to the three major indexes.
The Dow was lower, weighed down by a 7-percent fall in Nike (NKE.N) after the world’s largest footwear maker missed quarterly revenue estimates.
Oil prices touched four-month lows after data showed U.S. crude inventories rising faster than expected. [O/R]
The S&P 500 has gained 10 percent since the election, spurred mainly by Trump’s agenda of tax cuts and boost infrastructure spending, but high valuations remain a concern.
The benchmark index is trading at about 18 times forward earnings estimates against the long-term average of 15, according to Thomson Reuters data.
The Nasdaq Composite .IXIC added 0.35 percent to 5,814.04.
Five of the 11 major S&P sectors were higher, with the technology index’s .SPLRCT 0.67 percent gain leading the advancers.
The financial sector .SPSY, which suffered its worst daily drop since June on Tuesday, was down 0.15 percent.
Sears Holdings (SHLD.O) slumped 14 percent after the retailer warned on Tuesday about its ability to continue as a going concern after years of losses and declining sales.
Declining issues outnumbered advancing ones on the NYSE by a 1.20-to-1 ratio; on Nasdaq, a 1.57-to-1 ratio favored decliners.
The S&P 500 posted 10 new 52-week highs and 14 new lows; the Nasdaq Composite recorded 17 new highs and 81 new lows.
(Additional reporting by Tanya Agrawal; Editing by Nick Zieminski)