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Wait and see: Stocks steady at beginning of jam-packed week

ASSOCIATED PRESS

Trader Timothy Nick, foreground, works on the floor of the New York Stock Exchange, Monday, March 13, 2017. U.S. stock indexes stuck close to their record levels in early trading Monday, ahead of a busy week full of events that could swing markets.

NEW YORK >> U.S. stock indexes held steady Monday at the beginning of a week full of events that could swing markets. The Federal Reserve may raise interest rates, more countries around the world may move to shake up the economic status quo and several high-profile updates on the U.S. economy are coming out this week.

KEEPING SCORE: The Standard & Poor’s 500 index was little changed at 2,372 as of 3:17 p.m. Eastern time. The Dow Jones industrial average fell 24 points, or 0.1 percent, to 20,878. The Nasdaq composite rose 13 points, or 0.2 percent to 5,874. Four stocks rose for every three that fell on the New York Stock Exchange.

FED FOCUS: Most investors expect the Federal Reserve to raise short-term interest rates at its upcoming meeting, which ends on Wednesday. It would be only the third increase since the central bank slashed rates to a record low of nearly zero during the financial crisis in 2008.

Usually, rising interest rates are bad news for stocks because they make borrowing more expensive and can be a drag on economic growth. But many analysts say this time may be different. As long as the pace of increases is gradual, these moves will only be getting interest rates back to normal rather than slamming the brakes on the economy.

OK WITH THIS: It was only a few weeks ago that many investors were expecting the Fed to take a pass at its March meeting, hold steady and then raise rates later in the spring. But expectations have swung following more evidence that the economy is improving. The headliner was Friday’s jobs report, which showed hiring was strong in February.

A year ago, such a swing in expectations may have meant a sell-off in stocks as investors worried about the impact of higher rates, said JJ Kinahan, chief market strategist at TD Ameritrade. Now, it’s met with more equanimity because investors are focusing instead on the improving economy and hopes for bigger corporate profits in the future.

“It’s a very good sign,” Kinahan said. “It shows that people do have faith in stocks.”

ACTION ABROAD: The Fed isn’t the only central bank meeting on interest rates this week. So are the Bank of England, Bank of Japan and others around the world.

Many economists expect the Bank of England to hold steady, but another action in London could garner even more attention. The government could formally begin the process of exiting the European Union. The U.K. voted to leave the union last summer, one of a growing number of populations around the world trying to throw off the status quo.

The Netherlands has its own election this week, where politicians have also railed against the European Union and immigrants. Later this year, elections will occur in France and Germany.

OTHER U.S. UPDATES: Several big U.S. economic reports are also on deck this week, including updates on inflation and retail sales. Continued gains would encourage the Fed to continue to raise interest rates gradually, though a quick burst higher in inflation or another surprise could upset things.

GOLDEN: Mobileye, an Israeli autonomous-driving company, agreed to sell itself to Intel for $63.54 per share in cash. Its U.S.-listed shares surged $13.66, or 28.9 percent, to $60.93. Intel slipped 83 cents, or 2.3 percent, to $35.08.

INDEXED OUT: Urban Outfitters fell 84 cents, or 3.3 percent, to $24.35 for one of the largest losses in the S&P 500. S&P Dow Jones Indices said on Friday that it will remove the retailer from the S&P 500 index of large stocks and put it in the S&P 400 index of mid-cap stocks instead.

Frontier Communications and First Solar are also set to leave the S&P 500 just before trading begins on March 20, and their stocks likewise fell.

CRUNCHED: Del Taco Restaurants fell 58 cents, or 4.6 percent, to $12.01 after giving a forecast for 2017 revenue and earnings that fell short of analysts’ expectations.

CHECKING ITS OPTIONS: Pharmaceutical company Cempra rose 17 cents, or 4.9 percent, to $3.78 after it said it hired Morgan Stanley to help it figure out how to best use its cash.

MARKETS OVERSEAS: In Europe, France’s CAC 40 rose 0.1 percent, Britain’s FTSE 100 rose 0.3 percent and Germany’s DAX rose 0.2 percent. In Asia, Japan’s Nikkei 225 stock index rose 0.1 percent, South Korea’s Kospi rose 1 percent and the Hang Seng in Hong Kong jumped 1.1 percent.

CURRENCIES: The dollar largely held steady against its rivals. It inched up to 114.83 Japanese yen from 114.78 yen late Friday. The euro fell to $1.0666 from $1.0692.

YIELDS: Bond prices fell. The yield on the 10-year Treasury note rose to 2.61 percent from 2.58 percent. The two-year yield rose to 1.38 percent from 1.35 percent, while the 30-year yield climbed to 3.20 percent from 3.16 percent.

COMMODITIES: The price of a barrel of benchmark U.S. crude oil fell 9 cents to close at $48.40 a barrel. Brent crude, which is used to price international oils, slipped 2 cents to close at $51.35 a barrel in London. In other energy trading, wholesale gasoline fell 2 cents to $1.58 a gallon, heating oil was little changed at $1.50 a gallon and natural gas rose 3.5 cents to $3.043 per 1,000 cubic feet.

Gold rose $1.70 to settle at $1,203.10 an ounce, silver rose 5 cents to $16.97 an ounce and copper rose 3 cents to $2.63 a pound.

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