Wednesday's Market Recap - Stocks Closed Lower On Hawkish FOMC Minutes.
What is The Premarket Telling Us?
7:00 PM.
US stock futures are in the red this morning suggesting a negative start at the open. Dow futures down 72 points, Nasdaq down 18 points, and S&P down 7 points. Adding to the strength third quarter earning, Netflix reported a blowout earning quarter, after the close of trading yesterday. Shares of the company are significantly higher in the premarket.
On The Bond Desk:
The US 10 Year Bond Yield 3.16%, unchanged.
Currency Desk:
Euro dollar: 1.15
UK Pound: 1.31
Crude Oil:
WTI crude oil futures at $71.56/barrel, down 0.50%.
On the Earnings Calendar:
Netflix reported solid third quarter earnings, beating earnings and revenue expectations, and also blowing out net subscriber addition.
IBM reported a disappointing quarter. Earnings beat expectations, but revenues fell short of estimates.
In M&A News:
None.
What About The Asian And European Markets?
Major Asian markets closed higher. Japan (Nikkei 225) gained 1.29%, Shanghai up 0.60%, Hong Kong (Hang Seng) adding 0.07%.
Major European markets fell moderately in today's session. German (DAX) down 0.52%, France CAC 40 off 0.54%, London FTSE 100 lost 0.07%.
Market And Sector Dynamics
Stocks opened the trading day mostly lower. The Dow fell 130 points, Nasdaq gained 19 points, and the S&P down 2.18 points. Netflix reported blowout numbers after the bell last night, which is helping the technology sector early. Investors are also somewhat cautious, ahead of the Fed/FOMC minutes, due out at 2:00 PM. Investor will be looking for confirmation of the Fed's Dovish or Hawkish policy stance on interest rates.
Geopolitical issues with Saudi Arabia, and the murder of the Washington Post journalist, continues to be a negative for stocks, as markets worry about a weakening of Saudi US relations, and its significance for oil and energy markets.
Stocks were the weakest at about the midpoint of the morning session, that saw the Dow down 319 points, the low of the session.
By noon stock had staged a nice recovery, with the market nearly regaining all of the morning's losses, as technology and financials shares rallied, but gave up those gains after the Fed minutes were released mid-afternoon, as investors perceived the Fed minutes as being too hawkish.
Today's selloff was pronounced but orderly. Seven of the eleven S&P sectors closed the session lower. The declines were led by basic materials, consumer discretionary, industrials, and technology.
Factors Influencing Today's Market
Geopolitical situation in Saudi Arabia and the assumed murder of Journalist Jamal Kashoggi, and the potential impact on oil.
Crude oil traded significantly lower today. WTI crude oil closed at $69.75/barrel, down 3.02%.
Market perceived FOMC minutes to be hawkish contributed to market selloff.
Disappointing quarterly earning from IBM.
This week's EIA Status Report rose 6.5 million barrels up to $416.4 million barrels.
Market Close Volume Traded And Advance Decline Ratio
At the end of trading stocks were mostly lower. Dow down 91.74 points, Nasdaq down 2.79 points, and the S&P slipped 0.71 point. Totals NYSE volume traded, a moderate 3.26 billion shares. Declining shares out Advancing shares nearly 2:1.
Data Sources: Bloomberg, CNBC, CNN Money, Google Finance, Market Watch, TD Ameritrade, Yahoo Finance.
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