Stock indexes pull back modestly after a strong 3-week run


NEW YORK (AP) — Stocks were mostly lower in midday trading Tuesday as momentum slowed for a three-week rally that brought indexes to all-time highs. Netflix and other companies reported disappointing results, and the International Monetary Fund predicted a slowdown in the United Kingdom’s economy following its vote to leave the European Union.

KEEPING SCORE: The Standard & Poor’s 500 index was down 7 points, or 0.3 percent, to 2,160 at 11:49 a.m. Eastern time. All 10 sectors that make up the index were weaker, with the largest declines for raw materials producers. The Dow Jones industrial average edged down 20 points, or 0.1 percent, to 18,513. The Nasdaq composite fell 17, or 0.3 percent, to 5,038.

THE RUN THAT WAS: The S&P 500 had surged just over 8 percent since June 27, when stocks hit a bottom following the United Kingdom’s vote. Since then, fears that Britain’s departure would destabilize the global economy have largely dissipated, however a number of questions remain.

The IMF trimmed its forecast for global economic growth this year to 3.1 percent from 3.2 percent, mostly due to anticipated slowdowns in Britain and other advanced economies as a result of the “Brexit” vote.

GLOBAL MARKETS: Japan’s Nikkei 225 index jumped 1.4 percent on a weaker yen and a Pokemon-powered rally in Nintendo shares. France’s CAC 40 was down 0.6 percent, and Germany’s DAX shed 0.8 percent.

HIGHER BILLING, LESS CHILLING: Netflix was the worst-performing stock in the S&P 500, down $13.79, or 14 percent, to $85.02. It added fewer subscribers last quarter than it expected, which it blamed on customers leaving before a rate-freeze on their accounts expired.

STUBBED: Cigarette maker Philip Morris International fell $3.43, or 3.3 percent, to $99.57 after reporting weaker quarterly results than expected. Smokers in North Africa, Japan, Argentina and elsewhere bought fewer cigarettes, leading to a 5 percent drop in shipments for the company from a year earlier.

HOUSING STRENGTH: Home construction strengthened more in June than economists expected. Activity was particularly high in the Northeast and West, a report from the Commerce Department showed. The June reading on housing starts was the highest since February, though down from a year earlier.

HEALTHY SPOT: Johnson & Johnson rose $1.43, or 1.2 percent, to $124.57. The company also raised its forecast for full-year profits.

SAFETY TRADE: The usual spots that investors have run to when feeling scared were up, but only modestly. The price of gold rose $2.80, or 0.2 percent, to $1,332.10 per ounce. Treasury prices also inched higher. The yield on the 10-year note, which moves in the opposite direction of its price, fell to 1.55 percent from 1.59 percent late Monday.

GLOBAL OUTLOOK: Investors are anticipating a slew of events this week that they’ll assess to get a better read on the health of the world economy and what it might mean for stock markets. The European Central Bank’s policy rate decision is Thursday, and while no extra stimulus is expected, the bank’s views about the economy could create volatility in markets.

ENERGY: The price of crude oil fell 17 cents, or 0.4 percent, to $45.76 per barrel. Brent crude fell 8 cents, or 0.2 percent, to $46.88.

CURRENCIES: The euro fell to $1.1017 from $1.1068, and the British pound fell to $1.3126 from $1.3260. The dollar was close to flat against the Japanese yen.