A snap, crackle and pop debut for Snap could not stop investors selling off Wall Street a day after one of the strongest gains for months.
The Dow nearly closed below the recently attained 21,000 level losing 112.58 points, or 0.5%, to finish at 21,002.97. The S&P 500 index closed down 14.04 points, or 0.6%, at 2,381.92, with financial and materials stocks the major negatives on the day. The Nasdaq lost 42.81 points, or 0.7%, at finish at 5,861.22.
Wall Street though focused on social app Snap Inc., which soared on its debut in the market. It was valued at $US29 billion at the close.
Snap shares debuted jumped 51% at one stage, but that had no impact on the wider market because it is not in any of the indices.
While the enthusiasm could spread to an already bullish market, some analysts wonder if the conditions are being established for a mini bubble. The backers of Snap left tens of billions of dollars on the table as the shares, priced at $US17 each, opened at $US24 and then rose to a high of $US26.05, ending at $24.53.
But it is early days and analysts wonder if Snap is really the new Twitter which surged on its debut, touched $US72 and then collapsed to close overnight at $US15.78 and unwanted as talk continues that no one wants to buy the troubled company.
But the obvious bullishness from that float (it is now valued more than Twitter) was more than offset by profit taking and the surprise news that the industrial giant, Caterpillar had been raided by federal officials over an unspecified investigation by the Internal Revenue Service, the Commerce Department and the Federal Deposit Insurance Corp.
Caterpillar shares fell 4% after it confirmed the raids, but said no more. That was the largest one day fall for the stock in 8 months.
The company has already confirmed it has received a number of subpoenas from Federal officials.
