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Stocks’ winning streak ends as banking, metals slump

By MARLEY JAY, Associated Press
Published: June 9, 2016, 5:18pm

NEW YORK — A three-day winning streak for U.S. stocks ended quietly Thursday. A decline in bond yields sent bank stocks lower, while utilities and phone companies moved higher.

Stocks traded lower all day as investors took some profits. Banks took the biggest losses, followed by metals companies. With bond yields down, investors snapped up phone and utility company shares. Household goods makers turned higher late in the day, but that wasn’t enough to cancel out losses elsewhere.

“There’s just a little lack of confidence in the market,” said Steve Quirk, executive vice president of trading for TD Ameritrade. “When you’re sitting near 11 month highs and there is uncertainty, people are going to be cautious.”

The Dow Jones industrial average slid 19.86 points, or 0.1 percent, to 17,985.19. The Standard & Poor’s 500 index lost 3.64 points, or 0.2 percent, to 2,115.48. The Nasdaq composite declined 16.03 points, or 0.3 percent, to 4,958.62.

Stocks are still up for the week. Over the last few days the S&P 500 has reached its highest levels since last July. Oil prices have done the same.

Bond prices rose, sending the yield on the 10-year U.S. Treasury note down to 1.68 percent from 1.70 percent a day earlier. Lower bond yields drive down interest rates on mortgages and other kinds of loans, making them less profitable for banks.

Mortgage agency Freddie Mac reported that mortgage rates fell this week after three weeks of increases. Freddie Mac said the average 30-year fixed-rate mortgage slipped to 3.60 percent from 3.66 percent last week. A year ago the rate was 4.04 percent.

Bank of America gave up 24 cents, or 1.7 percent, to $14.19 and Capital One fell $1.23, or 1.7 percent, to $70.87.

Mining and chemicals companies also weakened. Copper and gold producer Freeport-McMoRan fell 68 cents, or 5.9 percent, to $10.90 and Eastman Chemical fell $1.84, or 2.5 percent, to $71.78.

Utilities and phone company stocks made modest gains as bond yields fell. Those stocks are seen as similar to bonds because they pay large dividends, so low bond yields make them more appealing by comparison. Ameren advanced $1.21, or 2.4 percent, to $50.89 and PG&E picked up 97 cents, or 1.6 percent, to $62.98. AT&T added 23 cents to $40.09.

Jam and spreads maker J.M. Smucker climbed after it reported strong fourth-quarter sales of coffee products and pet foods. The company also gave an optimistic profit forecast for the current fiscal year. Its stock jumped $10.52, or 7.9 percent, to $143.23.

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