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Home / Business / Stocks tend to stay lower as the Fed keeps interest rates

Stocks tend to stay lower as the Fed keeps interest rates



US. Stock prices remained mostly lower on Thursday, as the Federal Reserve unanimously upheld interest rates and signaled that it would gradually tighten monetary policy further.

How do benchmarks work?

The Dow Jones Industrial Average

DJIA, -0.29%

gained 40 points or 0.2% to 26,221, while the S & P 500 Index

SPX, -0.56%

lost 4 points or 0.2% to 2,809 and the Nasdaq Composite

COMP, -0.77%

fell 26 points or 0.4% to 7,544.

On Wednesday, all three indices ended the session just before their intraday highs and posted their best daily gains weeks. The Dow and the S & P 500 have rallied three consecutive times as the Nasdaq has progressed in succession.

What drives the market?

In a statement that was largely intact from its September meeting, the Fed said: "The Committee expects further gradual increases in the target corridor for federal interest rates." He also said that the risks to the economic outlook are about Balanced "And noted that inflation remains close to the 2% target.

The absence of significant changes in its comment suggests that the central bank is planning three rate hikes in December that will meet market expectations. Share prices rallied this week, with the exception of Thursday's weak recovery, as interim election results erased a level of uncertainty that had weighed on investors' sentiment.

See: Here, stock investors say after a split congress That the stoppage is good.

Meanwhile, the quarterly profit is racing Around 87% of S & P 500 companies ranked third in the quarter to date, with average earnings growth of more than 25% according to FactSet data. Investors are concerned that steady growth may not last long, especially as expansion in other parts of the world has come to a standstill.

DJIA, -0.29%

See also: The "smart money" does not buy the stock-hoppers, and that could mean a test of lows: Analyst [19659007] Another Point on the investors' radar is the drama surrounding the resignation of Jeff Sessions as Attorney General on Wednesday.

President Donald Trump had repeatedly blamed Sessions for investigating the special prosecutor Robert Mueller regarding possible links between the Trump campaign and Russian interference during the US elections in 2016.

Read: How the interim history have written: Numerous first results from the results of election night.

As far as the data are concerned, for the first time in the week ending November 3, unemployment claims fell by 1,000 to 214,000, the Department of Labor said. This was slightly higher than MarketWatch's surveyed economists with 210,000 forecasts. The total number of Americans who raised unemployment benefits fell to its lowest level since the summer of 1973.

What do the strategists say?

"I think the fact that we are stable after yesterday's start today is a positive sign," said Ed Keon, chief investment strategist at QMA, to MarketWatch. "I find it encouraging that bond yields were higher yesterday and are higher today. This suggests that the market is less worried about a recession and more confident growth. "

Keon does not expect much new information from the Fed statement, as there has been little change in the unemployment data or inflation data since the FOMC. Meeting in September. However, in its statement, the Fed suggests language that says it will Regarding the future interest rate trend "flexible in their approach" will be, you expect a rally of the market, he said.

Michael O & Rourke, chief market strategist at JonesTrading, warned clients not to console themselves with the Wednesday rally, which, as he noted in a research report, "has the hallmarks of a bear market rally – thanks of light volume thanks to the light volume to a hollow catalyst. "

" Other headwinds will soon prevail again, "wrote O & Rourke. "Has this market just recovered strongly in response to a vote on a day when the Attorney General's resignation could possibly lead the nation to a constitutional crisis? The catalyst begins to be hollow.

Which stocks are in focus?

Shares of Tesla Inc. .

TSLA, + 0.82%

surged 1.3% after electrician Robyn Denholm named his new chairman. He replaced CEO Elon Musk as head of the board with a relative outsider who faces the tough team. Maverick Billionaire.

Shares of Arris International PL C

ARRS, + 10.47%

rose 10% after the cable maker announced its acquisition by CommScope Holding Co . Inc.

COMM, -22.11%

Shares of Cardinal Health Inc.

CAH, + 3.65%

achieved after Nursing Services 4, 1% The company generated higher-than-expected earnings and sales in the first quarter, bolstered by the strength of the pharmaceuticals business.

D.R. Horton Inc.

DHI, -8.06%

fell 6.5% after reporting the fiscal quarterly results in line with expectations. However, sales declined as rising prices and higher interest rates led to a weakening of demand for housing.

Stocks of Monster Beverage Co .

MNST, -3.61%

fell 3.4% after CEO Rodney Sacks declared in a profit announcement with analysts Coca-Cola Co.

KO, -0.42%

planned the release of two new competition drinks. Monster has initiated arbitration with Coca-Cola, its largest shareholder, to determine if Coca-Cola will be able to launch drinks for competitors in April 2019. The outcome of the dispute could affect whether or not Coke will completely take over Monster.

Wynn Resorts Ltd.

WYNN, -12.33%

The stock dropped 12% after a profit announcement late Wednesday, in which CEO Matthew Maddox expects a "soft" market for Macau's fourth-quarter business.

TripAdvisor, Inc. .

TRIP, + 15.36%

rose 16% after bringing out a better result than expected.

[19459011SquareInc.

SQ, -10.38%

fell 9.5% after the company released disappointing forecasts for the fourth quarter.

Shares of Qualcomm Inc. .

QCOM, -7.84%

fell 7.3% after it was announced Wednesday night that the company lost money in the third quarter.

How do other markets act?

Asian stock markets were higher, with the exception of Chinese indices, while European stocks were mostly lower.

oil prices

CLZ8, -1.49%

fell, putting the US benchmark in danger of entering the bear market area. gold

GCZ8, -0.33%

sank lower and the dollar sank

DXY, + 0.39%

consolidated.

– Mark DeCambre contributed to this article at

providing critical information for the US trading day. Subscribe to MarketWatch's free Need to Know newsletter. Sign up here.


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