Rally comes to a halt on Wall Street

After three days of triple-digit gains, the Dow seems to have lost its momentum today, spending most of the day moving sideways.

US share prices spent most of the morning in New York shifting in and out of positive territory, with no substantial change either way. By the afternoon on Wall Street, the major indices had slipped into the red, but once again price movements are slight, with the Dow off by just 0.08% or 12 points and the S&P 500 down 0.13% at 1686.9. The NASDAQ 100 managed to advance, thanks to a 1.5% bounce in Apple, rising 0.08% to 3182.5.

September has got off to a rollicking start, with the Dow now within 2% of its record close, and so investors pausing for a bit of a breather is no big thing.

The impact of the day’s economic data has been softened by a cloud of uncertainty hanging over the latest US jobless claims figures. The headline number looked strong, with a 31,000 drop to 292,000 that came in comfortably below forecasts, but the reason underpinning the substantial decline appears to be caused by computer upgrades rather than labour market improvements: an analyst at the US Labor Department revealed that two states may not have processed all their claims over the course of last week when their computer systems were being updated.

The jobless claims report is therefore so clouded that it doesn’t afford us the last-ditch look at the jobs market for which we had hoped ahead of next week’s Fed meeting.

A separate report earlier showed that US import prices were unchanged in August month-on-month, declining 0.4% year-on-year. Cooling inflation plays into the hands of the doves at the Fed who think it may be too early to begin tapering.

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