Benchmarks mostly fell on Friday, dragged down by declines in financial shares. Financial stocks declined following an unexpectedly cautious stance on rate-hike outlook by the Federal Reserve. Friday was also a quadruple "witching" day that led to the expiration of stock-index futures, stock-index options, stock options and individual stock futures. While the Dow and the S&P 500 declined, the Nasdaq Composite Index remained at breakeven point. For the week, all the three major indexes finished in the green.
The Dow Jones Industrial Average (DJI) decreased 0.1%, to close at 20,914.62. The S&P 500 fell 0.1% to close at 2,378.25. However, the tech-laden Nasdaq Composite Index remained unchanged at 5,901.00. The fear-gauge CBOE Volatility Index (VIX) gained 4.2% to settle at 11.68. A total of around 884 million shares were traded on the NYSE on Friday. Advancers outpaced declining stocks on the NYSE. For 58% stocks that advanced, 39% declined.
Financials Dragged the Benchmarks Down
The Fed has increased federal funds rate by 25 basis points in March. Additionally, the central bank announced its intention of increasing rates two more times this year. Investors were expecting at least three more rate hikes by the end of this year. Such a conservative tone adversely impacted financial shares.
Some of the key holdings of the Financial sector in S&P 500 including Bank of America (BAC - Free Report) , Citigroup (C - Free Report) and Wells Fargo (WFC - Free Report) declined by 1.4%, 1.3% and 1.1% respectively. The broader Financial Select Sector SPDR (XLF - Free Report) decreased 1.3% and was one of the major decliners among the S&P 500 sectors.You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here .
On the economic front, the Board of Governors of the Federal Reserve System reported that industrial production remained unchanged in February following a 0.1% decrease in January. Also, capacity utilization declined 0.1% in February to 75.4%.
For the week, the Nasdaq, S&P 500 and Dow gained 0.7%, 0.2% and 0.1% respectively. enchmarks ended in the green mainly because of the gain in the dividend-paying sectors. Due to a conservative approach in Fed’s rate hike path there was an increase in bond yield which in turn helped to boost the dividend-paying sectors northward. There was an unprecedented decline in domestic crude inventories which in turn boosted oil prices and eventually energy stocks.
Stocks that made Headlines
Tiffany Beats on Q4 Earnings & Sales; Guides FY17
Tiffany & Co. (TIF - Free Report) posted the third straight quarter of positive earnings surprise, when it reported fourth-quarter fiscal 2016 results. ( Read More )
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