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A late afternoon slump leaves major US indexes mostly lower

Damian J. Troise and Alex Veiga
Associated Press

A late drop robbed the S&P 500 of another record high on Wall Street Monday and left major indexes mostly lower after being up for much of the day. The S&P 500 ended 0.3% lower. It was up as much as 1% earlier. The Nasdaq fell 1.3% and the Dow Jones Industrial Average eked out a tiny gain.

The price of gold, a haven for when investors feel anxious, fell.

The market was higher for much of the day as traders were relieved to learn President Joe Biden would renominate Jerome Powell to another term as chair of the Federal Reserve.

Biden's decision was a vote of confidence in Powell’s handling of central bank policies during the brutal disruptions caused by the coronavirus pandemic.

“Powell getting the nod is a sign that Biden is staying the course on monetary policy and the Fed is steadily moving toward normalizing policy,” said Brad McMillan, chief investment officer for Commonwealth Financial Network. “On the whole, the Fed is going to continue to be a force for monetary stability.”

The central bank is starting to trim bond purchases that have helped maintain low interest rates in an effort to support the economy and markets. The move to ease up on that support comes as rising inflation hangs over the economic recovery. Investors are closely watching the Fed to see whether pressure from rising inflation prompts it to speed up its plans for trimming bond purchases and raising its benchmark interest rate.

A mix of companies that rely on consumer spending also helped lift the market, though some big retailers fell. Target dropped 2.1% and Amazon fell 2%. Those retailers are on the cusp of the busy holiday shopping season, which traditionally kicks off right after the Thanksgiving holiday.

The dollar also strengthened against other currencies. The price of gold, a haven for when investors feel anxious, fell 2.4%.

Markets in Europe and Asia closed mixed as a resurgence of coronavirus outbreaks prompted some countries to look to stricter precautions to curb yet another wave of the pandemic.

Investors face a relatively light week of economic updates. The National Association of Realtors reported surprisingly good sales for previously occupied homes in October on Monday. The Commerce Department will report October data for new home sales on Wednesday, along with data on third-quarter gross domestic product.

Markets in the U.S. will be closed on Thursday for the Thanksgiving holiday. They will also close early on Friday.