Sept. 19 - Summary: Stocks end four-day rally as post-Fed meeting jubilance recedes; latest figures suggest economy adapting well to higher interest rates; gold spikes; JPMorgan moves to put legal woes behind it; Tesla hits record high. Conway G. Gittens reports.
Wall Street marched in place one day after stocks surged to levels never seen before. The Dow and S&P 500 trended lower, while the Nasdaq crept slightly higher. Economic signals pointing to incremental improvement: Business activity in the Mid-Atlantic states expanded this month at the fastest pace in over two years, sales of previously owned homes unexpectedly surged in August to a peak not reached since early 2007, and a separate gauge of future economic activity strengthened more than forecast. The only questionable piece of data - weekly jobless claims, which continue to be impacted by a switch to new software. Gold is sending its own signal. The precious metal had its biggest rally in 15 months as investors bet the Fed's buying strategy will ultimately heat up inflation. It's settlement day at JP Morgan Chase. The bank agreed to two different groups of fines or settlements totaling 1.3 billion dollars. The biggest chunk is tied to bad trades now known as the London Whale, which the bank originally tried to pass off as no big deal, but now admits to making "mistakes." The smaller amount relates to unfair credit card billing practices. Shares were under pressure with the bank's legal and regulatory problems far from over. From one bank to another - Wells Fargo sending out 1,800 pink slips to workers in its mortgage unit. The largest mortgage lender in the U.S. cutting back on staff as demand for home loans cool. Tesla could beat expectations for how much money it makes on each electric car it sells; that's the view of Deutsche Bank, which raised its price target on the stock. The upbeat forecast send shares of Tesla to a record high. In Europe, investors were less jubilant about Fed strategy but stocks were up nonetheless.