US close: Stocks weaker as Fed policymakers meet

By Sharecast News

Sharecast News | 20 Sep, 2023

Updated : 00:18

21:27 04/11/24

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Wall Street’s equity markets experienced a downturn on Tuesday as jittery traders, closely watching the Federal Reserve's two-day policy meeting, caused stocks to retreat by the end of the trading session.

By the close, the Dow Jones Industrial Average saw a slight decrease of 0.13%, finishing the day at 34,517.73, while the broader S&P 500 declined 0.22%, closing at 4,443.95.

The tech-heavy Nasdaq Composite Index was not immune to the trend either, ending the session down 0.23% at 13,678.19.

The dollar was steady against sterling on the currency front, last trading at 80.69p.

The greenback meanwhile weakened 0.02% against the euro to 93.62 euro cents, while it slid 0.07% on the yen to change hands at JPY 147.75.

“All eyes are on Wednesday's Fed rate decision, with the central bank expected to keep rates steady,” said IG senior market analyst Axel Rudolph.

“Comments regarding its future policy path will be closely monitored, though.

“Another rate hike later this year isn't off the table given the higher oil price is likely to increase inflationary pressures.”

Fed set to hold steady on interest rates, with possible future hike

Ahead of the end of its policy meeting, the Federal Reserve's policymakers were widely expected to maintain its official short-term interest rates at a range of 5.25% to 5.5%.

However, there was a palpable anticipation in the financial sphere that it could be leaning towards an additional 25 basis point increase before the end of the year.

Additionally, several financial experts predicted that the central bank could adjust the forecasted rate level for the close of 2024 upwards, settling at approximately 4.875%.

Elsewhere, the US housing sector experienced a significant decline in homebuilding activities last month, as the Department of Commerce revealed.

The seasonally-adjusted data displayed a substantial month-on-month dip of 11.3% in housing starts, translating to an annual rate of 1.283 million - a figure that notably missed the consensus projection of 1.439 million.

Contrary to the downturn, housing permits witnessed a considerable surge, rising 6.9% compared to the prior month and surpassing the consensus forecast with a rate of 1.543 million.

A detailed regional breakdown showed that housing starts dropped nationally, with the Northeast being the only exception, registering a modest increase of 1.0%.

While the single-family housing starts recorded a smaller monthly drop of 4.3%, reaching a rate of 941,000, permits for the category marked a growth of 2.0%, tallying 949,000.

Equities show mixed performance with Instacart in focus

In equity markets, Maplebear registered an impressive gain of 12.33%.

The company, which owns delivery service Instacart, enjoyed a favourable reception on its debut day at the Nasdaq, closing notably higher.

On the downside, energy giant Chevron ended the day marginally in the negative territory, declining by a minimal -0.01%.

The subtle drop followed its CEO, Mike Wirth, making headlines on Bloomberg TV just a day prior, sharing that crude oil prices might soon revisit the $100 per barrel mark.

However, some market analysts argued that anticipated fresh oil supplies outside the OPEC+ realm could mitigate prices in the forthcoming year.

Satellite launch firm Rocket Lab slid 7.54% after a satellite launch at its New Zealand facility failed.

Media and entertainment behemoth Walt Disney decreased 3.62% amid speculations that it could substantially ramp up its investments in parks and resorts over the next 10 years.

Reporting by Josh White for Sharecast.com.

Dow Jones - Risers

International Business Machines Corporation (CDI) (IBM) $146.56 0.99%
Apple Inc. (AAPL) $179.07 0.62%
Amgen Inc. (AMGN) $264.31 0.44%
Salesforce.Com Inc. (CRM) $215.86 0.33%
Travelers Company Inc. (TRV) $167.16 0.20%
McDonald's Corp. (MCD) $278.03 0.15%
Dowdupont Inc. (DWDP) $0.00 0.00%
Chevron Corp. (CVX) $167.48 -0.01%
Walmart Inc. (WMT) $163.37 -0.02%
Microsoft Corp. (MSFT) $328.65 -0.12%