Close Update: Wall Street Slumps as FOMC Stays on Track to Hike Rates Into 2019

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Wall Street’s benchmark averages were mixed at Thursday’s close with the Dow only fractionally higher and the S&P 500 and Nasdaq lower as disappointing corporate guidance coupled with a hawkish bias to the Federal Open Market Committee statement threw cold water on the post-election day rally.

Of the eleven S&P 500 sectors, all but financials were in the red with energy suffering the biggest losses. Brent crude futures fell to their lowest level since August while West Texas intermediate was down for a ninth straight day and nine-month low. The tech sector was weighed down by downbeat guidance from Qualcomm ( QCOM ) and Square ( SQ ), a few of the names that reported generally disappointing quarterly results that included Prudential ( PRU ), Wynn ( WYNN ) and DR Horton ( DHI ).

Data released this morning failed to put a dent in a more defensive market even as initial jobless claims dropped 1,000 to a 45-year low.

Thursday’s big event was the FOMC meeting which ended as-expected, but with a slightly more hawkish statement. Although the language was nearly identical to the prior statement, the exclusion of any language that would indicate slowing the pace of rate hikes in 2019 spooked Wall Street while at the same time sent the dollar racing higher. Accordingly, gold fell and Treasury yields inched higher. The yield on the 10-year note rose to its highest level since 2011.

Friday’s economic calendar picks up with the release of the producer price index, the Univ of MI consumer sentiment index and wholesale inventories. With the blackout period over, Fed presidents John Williams, Patrick Harker and vice chairman Randal Quarles will be speaking throughout the day.

US MARKETS

Dow Jones Industrial Average was up 10.92 points (+0.04%) to 26,191.22

S&P 500 was down 7.06 points (-0.25%) to 2,806.83

Nasdaq Composite Index was down 39.87 points (-0.53%) to 7,530.88

GLOBAL SENTIMENT

FTSE 100 was up 0.33%

Nikkei 225 was up 1.82%

Hang Seng Index was up 0.31%

Shanghai China Composite Index was down 0.22%

UPSIDE MOVERS

(+) NK (+37.27%) Reports ‘promising’ results of CD16 immunotherapy

(+) PTLA (+21.41%) Q3 loss narrows, revenue expands, beat expectations

(+) SND (+13.94%) Beat Q3 expectations, announced 2 million share repurchase plan

DOWNSIDE MOVERS

(-) COMM (-20.13%) Q3 results miss estimates; To acquire Arris

(-) PRGO (-16.32%) Reported better-than-expected EPS on below consensus revenue, lowers FY guidance

(-) WYNN (-13.13%) Q3 EPS below consensus

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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