BLBG: U.S Stock-Index Futures Decline After Equities Closed at Records
U.S. stock-index futures fell, indicating the Standard & Poor’s 500 Index will pare a seventh straight December (SPX) gain, after the gauge closed at a record for the 53rd time in 2014.
S&P 500 futures expiring in March dropped 0.3 percent to 2,078.90 at 9:15 a.m. in New York. Contracts on the Dow Jones Industrial Average lost 46 points, or 0.3 percent, to 17,936.
The S&P 500 has climbed 1.1 percent in December as the world’s largest economy expanded at the fastest pace in more than a decade and the Federal Reserve pledged to be patient on the timing of interest-rate increases. A report today will show consumer confidence increased in December, economists forecast.
“The U.S. economy is doing well,” Herbert Perus, who helps oversee $36 billion as head of equities at Raiffeisen Capital Management in Vienna, said in an interview. “Some stocks seem overpriced, but if you look deeper into the market you find a lot of good managed companies with good products that are still not expensive.”
The S&P 500 and Russell 2000 Index closed at all-time highs yesterday, while the Dow was near a record after climbing above 18,000 last week for the first time. The Nasdaq Composite Index finished at the highest level since March 2000.
December’s advance has extended the S&P 500’s rally for the year to 13 percent while the Dow has increased 8.8 percent. The Russell 2000 has advanced 4.8 for the year.
The gains for U.S. equities come amid a slump for the rest of the world. While the S&P 500 is heading for a third straight annual advance, the MSCI All-Country World Index excluding the U.S. is down 0.6 percent for the year.
Oil Selloff
The S&P 500 is trading at 17.5 times estimated profit, according to data compiled by Bloomberg. That’s about 9 percent above the multiple for the MSCI All-Country World Index.
After a selloff in oil prices pushed the S&P 500 to its lowest level in seven weeks on Dec. 16, the index resumed its rally in the latest of recoveries from upheavals that threatened to derail a bull market in its sixth year. The S&P 500’s worst retreat was only 7.4 percent, and the gauge recovered from each of its declines of 4 percent or more within one month.
The S&P 500 hasn’t had a four-day drop in a year. The benchmark gauge has declined for four consecutive trading sessions at least once every year since at least 2000. It also hasn’t had a decline of 10 percent or more over any period since October 2011.
Volume on U.S. exchanges has been lower in recent days. It was 32 percent below the three-month average yesterday and reached the lowest level of the year for a full day of trading on Dec. 26.
To contact the reporter on this story: Jonathan Morgan in Frankfurt at jmorgan157@bloomberg.net
To contact the editors responsible for this story: Cecile Vannucci at cvannucci1@bloomberg.net; Jeff Sutherland at jsutherlan13@bloomberg.net Jeff Sutherland, Alan Soughley
