PT KONTAK PERKASA – U.S. stock finished mostly lower Tuesday amid subdued activity as investors limited big bets ahead of the Federal Reserve’s monetary-policy decision on Wednesday. Concerns about continuing trade tensions lingered, further capping the market’s upside momentum.
How did major benchmarks fare?
The Dow Jones Industrial Average DJIA, -0.26% fell 69.84 points, or 0.3%, to 26,492.21 and the S&P 500 index SPX, -0.13% shed 3.81 points, or 0.1%, to 2,915.56.
The Dow has closed lower in back-to-back sessions, while the S&P 500 has fallen for three straight days.
The Nasdaq Composite Index COMP, +0.18% gained 14.22 points, or 0.2%, to 8,007.47, logging its second consecutive positive session.
What drove the market?
Investors are looking ahead to Wednesday’s policy decision by the Fed, which is widely expected to result in a 25 basis point interest-rate increase. The meeting will be followed by Fed Chairman Jerome Powell’s news conference during which investors are expected to seek further insight into the state of the economy, the impact of trade issues, and the path of future rate moves.
Issues surrounding trade remained at the top of investors’ list of worries. While Wall Street has repeatedly ignored the threat of rising trade tensions, focusing instead on strong economic data and corporate fundamentals, trade jitters have led to short-term volatility on fears that the situation could spiral out of control.
On Monday, Chinese officials fired back against President Donald Trump, accusing him of “trade bullyism” and pushing an “America First” agenda at the cost of international relations. Stock. The comments came as the latest exchange of tariffs took effect—10% tariffs on $200 billion worth of Chinese goods, which was met with $60 billion in tariffs on U.S. goods by China.
In the latest economic data, home prices rose 0.2% in July, the slowest pace of growth since last summer. Separately, the U.S. consumer confidence index rose to 138.4 in September from 134.7.
What were analysts saying? Stock
“We stick to our guns that further [trade] escalation may continue to have diminishing market effects, especially if the measures are already flagged well ahead before the official announcement,” said Charalambos Pissouros, senior market analyst at JFD Brokers.
“Investors have been digesting the idea of a full-blown trade war for months now, and on top of that, they are already aware of what could be the next steps. Stock. Yesterday’s market reaction corroborates our view,” he added, noting that the move lower was relatively modest.
“Recent speeches from Fed officials have noted that rates are approaching neutral and are on a path to turn restrictive amid continued economic expansion,” said Michelle Meyer, U.S. economist at Bank of America Merrill Lynch. As a result, the Fed is expected to communicate that its policy will no longer be accommodative by revising its language in the statement Wednesday.
What stocks were in focus?
Michael Kors Holdings Ltd. KORS, +1.95% shares rose 2% after the fashion company said it would buy Italy-based luxury goods company Gianni Versace SpA in a deal valued at $2.12 billion.
Sonic Corp. SONC, +18.71% rallied 19% on news that Inspire Brands, which has both company-owned and franchised restaurant brands, agreed to acquire the drive-in fast-food chain for about $2.3 billion, including assumption of Sonic’s debt.
AstraZeneca PLC AZN, +2.22% said that data showed its cancer treatment, Imfinzi, reduced the risk of death for patients by nearly a third compared with the standard of care. U.S.-listed shares advanced 2.2%.
Shares of Intel Corp. INTC, -2.13% fell 2.1% after Raymond James downgraded the stock to underperform.
The co-founders of Instagram announced they have resigned from Facebook Inc. FB, -0.30% and that they plan to leave the company in the coming weeks. Shares of the social-media giant slid 0.3%.
Ascena Retail Group Inc. ASNA, +11.72% soared 12% after it late Monday reported earnings and sales that beat expectations.
Novartis AG NVS, +0.72% plans to cut more than 2,000 jobs as part of a global restructuring, the latest move by its new chief executive to refocus the pharmaceutical giant toward higher-value drugs. Stock. Shares of U.S.-listed shares rose 0.7%.
What were other markets doing?
Trading in Asia was mixed, with Japanese equities rising but stocks in China falling on trade uncertainty. European stock indexes were broadly higher.
Crude-oil prices CLK9, +0.21% rose moderately, gold GCM9, +0.08% settled fractionally higher while the U.S. dollar index DXY, +0.07% was flat.
Source : marketwatch.com