Tag Archives: Fed

Stocks Rise Slightly After Fed Selloff

THURSDAY – Stocks rose slightly Thursday as the market tried to recover from back-to-back losing sessions, while traders digested the Federal Reserve’s plans to tighten monetary policy.

The Fed on Wednesday released the minutes from its March meeting, which showed that officials planed to reduce their trillions in bond holdings with a consensus amount around $95 billion. Meanwhile, policymakers indicated that one or more 50 basis-point interest rate hikes could be warranted to battle surging inflation.

Officials “generally agreed” that a maximum of $60 billion in Treasuries and $35 billion in mortgage-backed securities would be allowed to roll off, phased in over three months and likely starting in May.

The news sent the blue-chip Dow down more than 100 points Wednesday, while the S&P 500 slid 1%. The tech-heavy Nasdaq Composite dropped another 2.2%, bringing its week-to-date losses to 2.6%. Those losses came after comments from Fed Governor Lael Brainard pushed stock prices lower on Tuesday.

Investors await the weekly jobless claims data Thursday morning, which is expected to show a total of 200,000 claims filed.

Crude prices ticked higher after falling in the previous session. U.S. oil gained 0.7% to $96.94 per barrel, while international Brent advanced 0.9% to $101.95.

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Stocks Slip While Awaiting Fed Decision

Stocks opened slightly lower on Wednesday as a key decision from the Federal Reserve is expected this afternoon.

The Dow Jones Industrial Average fell just a fraction of a percent. The S&P 500 and Nasdaq Composite both slipped about a third of one percent.

The Fed is expected to cut rates by 25 basis points. This would be the bank’s second rate cut in a decade, after the central bank decided to lower the Fed Funds Rate to a range of 2.0%-2.25% in July. Chairman Jerome Powell will address the media on Wednesday at 2:30 p.m. ET.

Treasury yields fell ahead of the Fed’s announcement. The benchmark 10-year rate dipped to 1.77% from around 1.8%. The 2-year yield traded at 1.7%.

The Fed meeting takes place a couple of days after President Donald Trump called the central bank “boneheads” and asked for zero or even negative rates. The meeting also takes place as China and the U.S. try to reach a deal to end their ongoing trade war.

Trump said on Wednesday that a deal could come soon. China and the U.S. are expected to meet next month. The trade war has dampened the outlook for global economic growth and corporate profit expansion.

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