(Bloomberg) -- U.S. stocks swung between gains and losses, after the Standard & Poor’s 500 Index closed near a record, investors awaited testimony from the Federal Reserve’s Janet Yellen and tension increased in Ukraine.
General Motors Co. slipped 1.5% as U.S. regulators said they are investigating why the automaker took years to recall 1.6 million small cars over an ignition-switch defect. Sears Holdings Corp. rose 6% after reporting a narrower fourth-quarter loss. J.C. Penney Co. surged 21% as it predicted an increase in annual revenue and wider margins. Best Buy Co. added 5.4% as profit topped analyst estimates.
The S&P 500 fell 0.1% to 1,843.84 at 10 a.m. in New York after rising 0.1% earlier. The Dow Jones Industrial Average lost 3.6 points, or less than 0.1%, to 16,194.81. Trading in S&P 500 stocks was about 9% below the 30-day average during this time of the day.
“This market has been running to serious resistance about 1850 on the S&P 500,” Alan Gayle, a senior strategist at RidgeWorth Capital Management, said in a phone interview from Atlanta. His firm who oversees about $50 billion. “It has been trying to break to new highs and failed to do so several times. The market is looking for new catalysts to take it to new higher levels. It seems like all the news is going the other way.”
YELLEN TESTIMONY
The S&P 500 was little changed yesterday, closing fewer than 4 points below its record for a third straight day. The gauge topped its previous closing high of 1,848.38 each day this week, only to retreat from that level by the end of the session. The index came within six points of the record each day last week. It reached an intraday high of 1,858.71 on Feb. 24.
The gauge has rallied 5.9% since a low on Feb. 3 as investors speculated that severe winter weather explains the weakness in reports such as housing and hiring. Yellen said this month that the economy can withstand stimulus cuts, adding that only a notable change to the outlook would prompt the central bank to slow the pace of tapering. Yellen will testify today on monetary policy before the Senate beginning at 10 a.m. in Washington.
Reports today showed orders for U.S. durable goods fell less than forecast in January, a sign manufacturing was beginning to emerge from the harsh winter weather. The 1% decrease in bookings for goods meant to last at least three years followed a revised 5.3% slump in December that was larger than previously estimated, data from the Commerce Department showed today. The median estimate in a Bloomberg survey called for a 1.7% decline.
JOBLESS CLAIMS
More Americans than forecast filed applications for unemployment benefits last week, a sign the labor market is improving in fits and starts. Jobless claims increased by 14,000 to 348,000 in the week ended Feb. 22, exceeding all forecasts in a Bloomberg survey, from 334,000 in the prior period, a Labor Department report showed.
Stocks in Europe declined as Russia said it has begun military exercises near the Crimean border. Gunmen occupied Ukraine’s Crimea regional parliament and raised the Russian flag as lawmakers in the capital meet to approve a new cabinet after last week’s ouster of Viktor Yanukovych as leader.
“The story today is the unfolding situation in Ukraine and whether the S&P 500 can break above the 1840 to 1850 level,” Ryan Larson, the Chicago-based head of U.S. equity trading at RBC Global Asset Management (U.S.) Inc., said in an interview. His firm oversees $290 billion. Jobless “claims are taking a backseat to broader geopolitical and technical levels,” he said.
GM SHARES
GM declined 1.5% to $36.29. The National Highway Traffic Safety Administration announced the probe yesterday in an e-mailed statement. The agency could fine GM as much as $35 million, which would be the most ever by the agency, if it finds the largest U.S. automaker failed to pursue a recall when it knew the cars were defective.
Inovio Pharmaceuticals Inc. fell 10% to $3.35. The drug researcher and developer said it will sell additional common stock.
Sears added 6% to $42.84. The retailer run by hedge fund manager Edward Lampert said its net loss narrowed to $3.37 a share from $489 million, or $4.61 a share, a year earlier. Revenue fell 14% to $10.6 billion.
EARNINGS SEASON
J.C. Penney surged 21% to $7.23. Same-store sales will increase by a mid-single digit%age and gross margin will “significantly” improve this year, the company said yesterday in a statement. Chief Executive Officer Mike Ullman forecast that the retailer’s turnaround will be completed this year.
Ullman’s attempt to revive the department-store chain gained traction during a holiday season marked by a discount war among retailers seeking to attract tentative shoppers.
Best Buy added 5.4% to $27.21. Chief Executive Officer Hubert Joly is working to cut $1 billion in costs, up from an earlier target of $725 million, by improving the company’s supply chain and reducing the number of products that get returned or damaged.
Tesla Motors Inc. rose 2.6% to $259.67. The electric-car maker yesterday announced plans to invest $4 billion to $5 billion in a large battery factory by 2020 and will fund about $2 billion of that amount.
