US STOCKS-Wall Street gains slightly, with weakness in banks and energy weighing

Wall Street's benchmark S&P 500 index rose slightly on Tuesday with concerns about slowing economic growth stunting gains as bank stocks sank on current-quarter weakness while energy shares tumbled. On the Nasdaq, 1,992 stocks rose and 2,122 fell as declining issues outnumbered advancers by a 1.07-to-1 ratio while the S&P 500 posted 45 new 52-week highs and 13 new lows.

Wall Street's benchmark S&P 500 index rose slightly on Tuesday with concerns about slowing economic growth stunting gains as bank stocks sank on current-quarter weakness while energy shares tumbled. Energy was the biggest percentage decliner among the benchmark's 11 industry indexes, off more than 2%, as crude oil futures fell as OPEC+ cut its demand forecast for 2024 and 2025.

Bank stocks fell broadly after Goldman Sachs CEO David Solomon said late on Monday that trading revenue will probably slip 10% this quarter. On Tuesday, JPMorgan Chase's president tempered expectations about income from interest payments. Also, the finance chief of smaller consumer lender Ally Financial said credit challenges have intensified in the current quarter as borrowers struggled with high inflation, sending its shares down 17%.

The concerns about weak fundamentals in the finance industry overshadowed the Federal Reserve's regulatory chief unveiling a sweeping bank capital plan after intense industry opposition. "A lot of the action today is being driven by concern the banks are lowering expectations for earnings for the current quarter," said Lindsey Bell, chief strategist at 248 Ventures in Charlotte, North Carolina.

"The news from JPMorgan, Goldman Sachs and Ally stole the show because they're saying that fundamentally their business is slowing down. The fundamental re-rating lower is taking precedence over the good news on the regulatory side," she said. Investors are also worried about the weaker energy outlook on top of uncertainty about a Fed decision on interest rates next week and November's U.S. presidential election.

"We're getting these signs that economic growth across the globe is slowing and it adds angst when we already have such uncertainty here with the election cycle," Bell said, suggesting that both September and October could be weak months for stocks. Wall Street's main indexes had recorded gains of more than 1% on Monday as investors looked for bargains following a week of steep losses.

At 2:40 p.m. EDT the Dow Jones Industrial Average fell 123.00 points, or 0.30%, to 40,706.59, the S&P 500 gained 19.05 points, or 0.35%, to 5,490.10, and the Nasdaq Composite gained 125.06 points, or 0.74%, to 17,009.66. The S&P 500's financial industry index was the benchmark's second-weakest sector and its biggest index point drag on Tuesday with a 1% drop. It biggest drags were JPMorgan Chase, down 5% ,and Goldman Sachs, down 4.5%.

On Tuesday night investors will monitor a televised debate between Democratic presidential candidate Kamala Harris and Republican candidate Donald Trump. The two, who have never met in person, will square off at 9 p.m. EDT (0100 GMT). On Wednesday, investors will closely monitor the August consumer price index, which is expected to show a slight moderation in the headline number to 2.6% on a year-on-year basis and remain unchanged at 0.2% on month. On Thursday, the producer prices report will follow the CPI data.

In individual stocks, Hewlett Packard Enterprise dropped 6% after the server maker announced a $1.35 billion mandatory convertible preferred stock offering to fund its acquisition of Juniper Networks. Oracle jumped 10.9% after beating estimates for quarterly results.

Declining issues outnumbered advancers by a 1.18-to-1 ratio on the NYSE where there were 318 new highs and 156 new lows. On the Nasdaq, 1,992 stocks rose and 2,122 fell as declining issues outnumbered advancers by a 1.07-to-1 ratio while the S&P 500 posted 45 new 52-week highs and 13 new lows. The Nasdaq Composite recorded 38 new highs and 144 new lows.

(This story has not been edited by Devdiscourse staff and is auto-generated from a syndicated feed.)