U.S. stock indexes closed lower on March 5, 2019, as investors remained cautious about the prospects of a U.S.-China trade agreement while weak construction spending data added to market concerns. The Dow Jones Industrial Average declined 0.79% to 25,820.53, the S&P 500 fell 0.38% to 2,792.91, and the Nasdaq Composite dropped 0.23% to 7,577.57.
Reports indicated U.S. President Donald Trump and Chinese President Xi Jinping were nearing a trade deal by March 27, 2019, following progress in negotiations. However, market gains were tempered by December 2018 data showing unexpected declines in private and public investment, which contributed to the downturn.
Analysts noted profit-taking after a strong start to the year, with Michael O’Rourke, chief market strategist at JonesTrading, stating, "Now that a deal looks like it’s in the finishing stages you’re seeing people take profits." The S&P 500 had risen 11.8% year-to-date by late February 2019 but remained 4.3% below its record high.
Trade Dynamics ¶
Treasury yields declined as markets adjusted to recent volatility, with U.S. bond prices rising despite weak manufacturing and consumer data. The dollar strengthened against major currencies, reaching a four-day high as traders anticipated a resolution to the trade dispute. The euro fell 0.29% to $1.1341.
Oil prices edged higher on OPEC+ supply cut announcements, with Brent crude rising 0.92% to $65.67 per barrel and U.S. crude gaining 1.42% to $56.59. Precious metals saw mixed performance, with gold falling 0.5% to $1,287.42 an ounce as the dollar’s strength pressured bullion prices.
