By Yashaswini Swamynathan
U.S. stocks were flat in late morning trade on Wednesday as a set of weak economic data weighed on bank shares, while investors waited for the Federal Reserve to pull the trigger on a second interest rate hike this year. U.S. retail sales recorded their biggest drop in 16 months, while consumer prices fell unexpectedly in May, raising questions about the Fed's ability to further tighten monetary policy. While traders continued to see a more than 93 percent chance for the Fed to raise rates at the end of the two-day meeting on Wednesday, they dialed back the odds of a third hike this year.The S&P 500 financial sector fell 0.6 percent, led by declines in big banks that stand to gain from higher interest rates. The economic data also pressured the dollar index, which fell to its lowest since Nov. 9. "With the weak data, you start to wonder why the Fed is so bent on raising rate. It seems they should be doing the opposite," said Robert Pavlik, chief market strategist at Boston Private Wealth.
"I think some Fed members are going to be skeptical about raising rates for the third time later this year, but I don't think they will step up and say they shouldn't be doing it today."The Fed meeting could also provide details on the central bank's plans to trim its $4.5 trillion balance sheet. At 10:54 a.m. ET (1454 GMT), the Dow Jones Industrial Average was down 1.54 points, or 0.01 percent, at 21,326.93. The index had hit an all-time high of 21,345.56, earlier in the session.
The S&P 500 was down 1.67 points, or 0.07 percent, at 2,438.68 and the Nasdaq Composite was up 3.90 points, or 0.06 percent, at 6,224.27.Five of the 11 major S&P sectors were lower, with energy declining 2.2 percent as oil prices tumbled after data showed a surprise build in U.S. inventories. [O/R]Exxon and Chevron were the top drags on the S&P and the Dow.
Johnson & Johnson rose 0.6 percent to $132.76 after the company's flu drug succeeded in a mid-stage trial. The stock provided the biggest boost to the S&P and the Dow.Facebook, Mircosoft and Alphabet, which had been hit hard by a selloff in the tech sector earlier this week, rose for the second straight day. H&R Block rose 10.6 percent to $29.79 after the tax preparation service provider's fourth-quarter revenue and profit beat analysts' expectations. Declining issues outnumbered advancers on the NYSE by 1,499 to 1,293. On the Nasdaq, 1,578 issues fell and 1,069 advanced. (Reporting by Yashaswini Swamynathan in Bengaluru; Editing by Anil D'Silva)
This story has not been edited by Firstpost staff and is generated by auto-feed.
Published Date: Jun 14, 2017 21:57 PM | Updated Date: Jun 14, 2017 21:57 PM