Stocks make small gains
NEW YORK — Signs that lawmakers are making moves to end a stalemate in Washington and avert a potential federal default pushed stocks higher on Wednesday.
President Barack Obama is making plans to talk with Republican lawmakers at the White House in the coming days as pressure builds on both sides to resolve their deadlock over the federal debt limit and the partial government shutdown before the U.S. Treasury runs out of cash next week.
Losses for the stock market had accelerated at the start this week as the shutdown dragged on and both the White House administration and House Republicans appeared to be coming more entrenched in their positions. The S&P 500 has fallen about 4 percent since climbing to a record on Sept. 18.
“We were quite oversold,” said Alec Young, a global equity strategist at S&P Capital. “For this really to have any legs, though, we need to see signs of compromise in Washington.”
The S&P 500 index rose three points, or 0.2 percent, to 1,658 as of 3:26 p.m. Eastern Time.
The index lost 2 percent in the first two days of this week as concerns grew that politicians would fail to reach a deal before the government hits its debt ceiling on Oct. 17.
The Dow Jones industrial average rose 58 points, or 0.4 percent, to 14,836. The Nasdaq composite fell six points, or 0.4 percent, to 3,681.
The pace of companies reporting third-quarter earnings is also picking up this week, giving investors better insight into how corporate America is doing.
Yum Brands, the owner of KFC, Taco Bell and Pizza Hut, was the biggest decliner in the S&P 500 index after its earnings fell short of Wall Street’s expectations.
The discount retailer Family Dollar also slumped after giving a cautious earnings forecast for next year.
“It looks like there has been some disappointment in the early earnings already,” said Colleen Supran, a principal at San Francisco-based Bingham, Osborn & Scarborough, an investment adviser and asset management company.
Yum Brands slumped $5.91, or 8.3 percent, to $65.40.