Stocks edge down from record highs; S&P 500 win streak ends

U.S. stocks faded a bit from their record highs Friday as telecom and energy stocks sank. The loss for the Standard & Poor’s 500 index was small, but it was the first in nearly two weeks — and meant the end of the index’s longest winning streak in four years.

Much of the day’s action was centered on the government’s jobs report, which is usually the most anticipated economic data of each month, but it was a muddled one.

Economists cautioned not to read too much into the hiring numbers, which were far weaker than expected, because they were distorted by hurricanes that damaged businesses from Texas to Florida. Investors focused instead on a stronger-than-expected rise in workers’ wages, which helped to push Treasury yields higher.

The S&P 500 fell 2.74 points, or 0.1%, to 2,549.33. The Dow Jones industrial average slipped 1.72 points, or less than 0.1%, to 22,773.67. The Nasdaq composite edged up 4.82 points, or 0.1%, to 6,590.18. All three indexes had closed at record highs Thursday.

Roughly nine stocks fell for every five that rose on the New York Stock Exchange.

If rising wage growth feeds into higher prices across the economy, it makes the Federal Reserve that much more likely to keep raising interest rates from their record lows. As a result, investors made moves Friday in anticipation of a rate increase in December.

The yield on the 10-year Treasury jumped as high as 2.39% shortly after the release of the jobs report, up from 2.35% late Thursday. The gains faded later in the day, which traders said may have been due to worries about tensions with North Korea. A Russian lawmaker said that North Korea is preparing to test-fire a long-range missile soon.

Late Friday, the 10-year yield sat at 2.36%. The two-year Treasury yield climbed to 1.52% from 1.49%, and the 30-year yield rose to 2.91% from 2.89%.

When bonds pay higher yields, it makes them more attractive to investors looking for income, undercutting demand for stocks that pay relatively big dividends. Telecom stocks in the S&P 500 fell 2%, the largest drop among the 11 sectors that make up the index.

Energy stocks were also among the market’s weakest after the price of benchmark U.S. crude sank $1.50, or 3%, to settle at $49.29 a barrel. It’s the fourth drop for oil in the last five days. Brent crude, the international standard, fell $1.38, or 2.4%, to $55.62 a barrel.

Costco Wholesale slumped 6% to $157.09 — the biggest decliner in the S&P 500 — despite reporting stronger earnings for the latest quarter than expected. Analysts pointed to a slight drop in its membership renewal rates, among other factors.

Herbalife jumped 11.2% to $75.25 after the Los Angeles maker of nutritional supplements announced preliminary results of its self-tender offer.

In overseas markets, the FTSE 100 in London rose 0.2%, France’s CAC 40 fell 0.4% and Germany’s DAX slipped 0.1%. Japan’s Nikkei 225 and the Hang Seng in Hong Kong both advanced 0.3%.

In the currency market, the dollar slipped to 112.71 yen from 112.85 yen. The euro rose to $1.1735 from $1.1708, and the British pound fell to $1.3065 from $1.3116.

In the commodities markets, natural gas fell 6 cents to settle at $2.86 per 1,000 cubic feet. Wholesale gasoline fell 5 cents to $1.56 a gallon. Heating oil fell 4 cents to $1.74 a gallon.

Gold rose $1.70 to settle at $1,274.90 an ounce. Silver rose 15 cents to $16.79 an ounce. Copper fell 2 cents to $3.03 a pound.

UPDATES:

2:40 p.m.: This article was updated with closing prices and context.

This article was originally published at 7:55 a.m.