US close: Markets down on hawkish Fedspeak

By Sharecast News

Sharecast News | 11 May, 2017

23:31 15/11/24

20,394.13
-2.40%-502.54

Max: 20,684.56
Min: 20,315.08

Volume: 0
MM 200 : 19,002.01

Hawkish Fedpseak overnight pushed Wall Street off its lofty perch against a backdrop of sharp share price falls for Macy's and Snapchat which appeared to dent sentiment.

The Dow Jones Industrial Average was down by 0.11% to 20,919.41, while the S&P 500 slipped 0.22% to 2,394.44 and the Nasdaq 100 lost 0.13% to 5,674.22.

Speaking on Wednesday evening, the president of the Federal Reserve bank of Boston, Eric Rosengren, said three more interest rate hikes were still appropriate in 2017.

Combined, the news from the Fed and the latest company results appeared to give investors looking for reasons to continue buying into the market pause for thought.

On a related note, analysts at Bank of America-Merrill Lynch pointed out how the S&P 500's forward price-to-earnings ratio - at 17.5 - was at its highest since 2004 and 15% above its long-term average.

"The S&P 500 trades at a 13-year high. Stocks looks cheap vs. bonds but stretched vs. history; large is cheaper than small," BofA-ML said.

In economic news, initial weekly unemployment claims dipped by 2,000 to 236,000 over the week ending on 6 May, against a consensus forecast for 245,000.

Producer prices rebounded in April, increasing at a 0.5% month-on-month clip, ahead of consensus expectations for 0.2%.

Macy's stock was ground, falling 17.01% after posting first quarter earnings per share of 24 cents, leaving analysts looking for earnings per share of 35 cents startled.

Snap shares were down a whopping 21.45% on the heels of its maiden earnings release as a publicly-listed outfit.

The company went public on 3 March at $17 per share, before quickly rising as high as $29, though after Thursday’s losses, Snap now sat at $18.05 per share.

Kohl's shares were down 7.88% after the department store reported better-than-expected earnings for the first quarter, but weaker sales.

Net income came in at $66m or 39 cents a share, up from $17m or 9 cents a share in the first quarter of last year, but sales fell to $3.84bn from $3.97bn.

Dow Jones - Risers

Exxon Mobil Corp. (XOM) $82.61 0.85%
Merck & Co. Inc. (MRK) $64.43 0.77%
Caterpillar Inc. (CAT) $101.00 0.63%
General Electric Co. (GE) $28.88 0.59%
Apple Inc. (AAPL) $153.95 0.45%
Boeing Co. (BA) $183.95 0.41%
Johnson & Johnson (JNJ) $123.20 0.32%
Coca-Cola Co. (KO) $43.67 0.23%
United Technologies Corp. (UTX) $121.28 0.21%
3M Co. (MMM) $196.75 0.06%