The S&P 500 edged lower to snap a four-session win streak on Tuesday and it retreated from a record high as investors grappled with a flood of earnings and the latest update on a potential trade deal between the U.S. and China.
Hopes of a U.S.-China trade deal and expectations of another interest rate cut by the Federal Reserve when it concludes its two-day meeting on Wednesday have pushed stocks higher the past several sessions, sending the S&P to its second straight record intraday high.
But indexes pulled back after a U.S. administration official told Reuters that Washington and Beijing are continuing to work on an interim trade agreement, but it may not be completed in time for the leaders of the two countries to sign in Chile next month.
“It is actually impressive that we have held these gains, even if we are down slightly, it is a pretty impressive day considering what is going on, that there hasn’t been this hard sell-off pressure,” said JJ Kinahan, chief market strategist at TD Ameritrade in Chicago.
“The encouraging thing is we are trading more on what you should be trading on, that being earnings, and less on rumor and innuendo, which is a nice change of pace and how the market should work.”
Tech shares, which have been closely tied to trade progress, lost ground after the report and were last down 0.92%.
Drugmakers Merck & Co. Inc. (MRK) and Pfizer Inc. (PFE) both gained after reporting upbeat third-quarter results to help keep the Dow and S&P near the flat line. The healthcare sector, which has been the second-worst performer among the 11 major S&P 500 sectors this year, rose 1.16% as the best performer on the session as Merck gained 3.5% and Pfizer advanced 2.5%.
But shares of Google