Stocks Play Defense; Homebuilders Are Worried – Investor's Business Daily

U.S. stock indexes meandered above and below the day’s break-even line in afternoon trading Thursday, as defensive stocks led the gainers.

XAutoplay: On | OffThe Nasdaq and S&P 500 rose 0.1% while the Dow Jones industrial average fell a fraction. The small-cap Russell 2000 rose about 0.15%. Volume in the stock market today was higher on the NYSE and lower on the Nasdaq compared with the same time Wednesday.

The day’s leaders had a defensive tilt. The Dow Jones utility average rose 0.7%. Diversified utilities, hospitals and generic drugs showed some of the best gains.

Top-rated groups were struggling in afternoon action. For example, the homebuilder group fell 1.6% on growing conviction that President Trump’s pro-tariff policies are making lumber more expensive. In April, the Trump administration announced new tariffs on Canadian lumber of up to 24%. Market watchers say the tariffs are acting as an economic depressant, countering the stimulus of deregulation.

The homebuilder group is down 3.3% so far this week. If that loss holds, it would be the biggest weekly percentage drop for the group since late October.

Blue chips were mostly up, but a 4.2% drop in Home Depot (HD) weighed on the Dow Jones industrial average.

News that Sears Holding (SHLD) reached an agreement to begin selling its Kenmore appliances on (AMZN) appeared to hurt Home Depot, Lowe’s (LOW) and Best Buy (BBY).

The stock of Sears was up 14%, while Lowe’s and Best Buy lost 5% and 3.5%, respectively.

Meanwhile, banks have been struggling to find thrust from recent quarterly reports that generally beat the Street’s numbers. On Thursday, Bank of New York Mellon (BK) rose 2% to a 52-week high after reporting earnings that topped estimates by 10.7%.

The money-center banks group has risen 9% since the end of May, outperforming the S&P 500 and Nasdaq, which rose about 3% in that same period.


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