Markets closed mostly in the red on Wednesday, as the Fed left interest rates unchanged, while trade war fears once again offset strong gains in tech stocks. This saw the Dow and S&P 500 ending in the day lower. However, the Nasdaq closed higher, helped by robust gains from Apple.
The Dow Jones Industrial Average (DJI) declined 0.3%, to close at 25,333.82. The S&P 500 slid 0.1% to close at 2,813.16. The Nasdaq Composite Index closed at 7, 707.29, jumping 0.5%. A total of 6.83 billion shares were traded on Wednesday, higher than the last 20-session average of 6.21 billion shares. Decliners outnumbered advancers on the NYSE by a 1.74-to-1 ratio. On Nasdaq, a 1.07-to-1 ratio favored declining issues.
How did the Benchmark Perform?
The Dow shed 81.37 points, as industrial stocks took a hit once again on fears of trade war once again escalated. Shares of Caterpillar (CAT - Free Report) and 3M Company (MMM - Free Report) declined 3.7% and 2.5%, respectively. Caterpillar has a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The S&P 500 lost 2.93 points. The Industrial Select Sector SPDR (XLI) declined 1.4%. The Technology Select Sector SPDR (XLK) was the best performer gaining 0.9%. Eight of the 11 major S&P 500 sectors ended in negative territory. The tech heavy Nasdaq gained 35.50 points, as shares of Apple (AAPL - Free Report) gained 5.9% on the back of robust earnings (read more: Apple Posts Strong Quarter, But Is It Still Too Dependent on the iPhone?).
Trade War Fears Hit Markets
Trade war fears once again escalated on Wednesday, rattling markets. The ongoing trade dispute between the United States and its trading partners have been taking its toll on markets for the last few months. Wednesday once again saw the fears coming back on reports of the Trump administration planning to slap 25% tariffs on another $200 billion worth of Chinese goods.
Earlier in July, the United States had imposed tariffs on $34 billion worth of Chinese goods, which saw China retaliating with tariffs on equal amount of goods. Wednesday’s report made investors jittery once again leading to huge selloff, which even offset the gains made by tech stocks. However, the robust earnings results from Apple helped pare some of the losses, which saw the Nasdaq closing higher.
Fed Keeps Rates Unchanged
The Fed, which concluded it two-day meeting on monetary policy on Wednesday, kept its interest rate unchanged at 1.75% to 2%, as was expected. The Fed has already raised rates twice this year. However, the Fed gave hints that it is likely to hike rates the next as the economy remains strong.
Prior to the announcement Treasury yields rose, with the 10-year note yield crossing the psychological 35 mark for the first time since June.
Stocks That Made Headlines
Apache Q2 Earnings Beat on Oil Price, Permian Strength
U.S. energy firm Apache Corporation (APA - Free Report) reported second-quarter earnings, which came in ahead of the Zacks Consensus Estimate. (Read More)
Marathon Oil Q2 Earnings & Revenues Miss, Improve Y/Y
Marathon Oil Corporation (MRO - Free Report) posted second-quarter adjusted income from continuing operations, turning around from the year-ago quarter’s loss. (Read More)
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