U.S. stocks erased early gains as Federal Reserve Chairman Ben S. Bernanke’s testimony to Congress disappointed investors anticipating a more definitive signal the central bank was prepared to provide more stimulus.
The Standard & Poor’s 500 Index fell less than 0.1 percent to 1,352.92 at 10:03 a.m. in New York after climbing as much as 0.6 percent in the first half hour of trading.
Bernanke said progress in reducing unemployment is likely to be “frustratingly slow” and repeated the Fed is ready to take further action to boost the recovery, while refraining from discussing specific steps.
The S&P 500 slipped in seven of the last eight sessions before today and is down more than 4 percent from a four-year high in April as economic data trailed estimates and investors braced for the first decline in quarterly profits since 2009.
Bernanke’s testimony follows data yesterday showing a contraction in June retail sales and a report today that the cost of living in the U.S. was little changed in June, a sign inflation may stay subdued.
The Citigroup Economic Surprise Index for the U.S., which measures how much data from the past three months is beating or missing the median estimates in Bloomberg surveys, is at minus 64, near the almost 11-month low of minus 64.9 reached last week. The gauge peaked at 91.9 in January.
Earnings beat estimates at 32 of the 45 companies in the S&P 500 that have reported quarterly results so far, data compiled by Bloomberg showed. Earnings are down 3.1 percent for the group and profits are projected to decrease 2.1 percent for the entire S&P 500.