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US: Stocks dip as health vote delayed
[NEW YORK] US stocks declined modestly on Thursday after Republicans postponed a vote on President Donald Trump's replacement health care plan, which has been seen as a barometer of support for the president's broader agenda.
Analysts view the health care vote as an early read on whether the new US president will succeed in pushing through his promised pro-growth policies, including tax cuts and deregulation.
International investors also are closely watching the activity. European markets closed higher, prior to the news the vote was pushed back and following Wednesday's largely upbeat US session.
US stocks spent most of the session in positive territory, but fell after the late-afternoon news of the vote delay. The Dow finished at 20,656.58, down less than 0.1 per cent and about 100 points below its session high.
"It's somewhat surprising the market isn't off more than this," said Jack Ablin, chief investment officer at BMO Private Bank, adding that there still was a possibility the bill could pass.
"I don't think investors have given up hope, but certainly enthusiasm has been dialed down." The White House played down suggestions the vote was delayed due to lack of support, with an administration official saying it would take place on Friday and would pass.
Analysts said stocks could move significantly depending on the outcome.
"Should the healthcare plan be approved by Congress then we could see a resumption of the Trump rally, while a failure could leave markets vulnerable to a larger correction," said Oanda analyst Craig Erlam.
Google parent Alphabet dropped 1.5 per cent after AT&T and Verizon joined a Google ad boycott due to the placement of their ads alongside offensive content posted by white supremacists and religious extremists.
Morgan Stanley said in a note the issue was unlikely to significantly affect Google's near-term results provided it takes action.
"Google isn't yet fully addressing advertisers' concerns and needs to take stronger steps to regain the trust of brands," the note said.
Ford shares dropped 0.9 per cent after it lowered its first quarter earnings estimate, saying it would come in well below analysts' expectations amid an industry-wide decline in US and Chinese car sales in 2017.