Stocks fall and oil tumbles into a bear market

Thomson Reuters

Stocks closed lower Thursday after the Federal Reserve left its benchmark interest rate unchanged.  West Texas Intermediate, the US oil benchmark, tumbled into a bear market. Follow US stocks in real time here.

Stocks fell Thursday as disappointing earnings weighed on technology companies and after the Federal Reserve left its key rate unchanged and signaled it was still on track for one more hike this year.

The Dow Jones Industrial Average was mostly flat, and the S&P 500 was down 0.25%. The Nasdaq Composite lost 0.53%. The three major US indices had rallied a day before on the back of the midterm elections, where Democrats took control of the House and Republicans extended their majority in the Senate.

The dollar climbed 0.4% against a basket of currencies after the Federal Reserve kept its benchmark interest rate steady at 2.25% and signaled its fourth rate increase of the year could come in December. Treasury yields were also higher, with the 10-year up 1.9 basis points to 3.232%.

Ian Shepherdson, the chief economist at Pantheon Macroeconomics, said he was slightly surprised the Fed didn’t mention the drop in stocks. But he added that the rally over the past week meant the net impact on financial conditions since the stock market’s peak in early October had been relatively small.

“Assuming that remains the case, a rate hike next month is a done deal, but what we really want to see is how the Fed’s thinking evolves over the first few months of next year if the labor market continues to tighten and wage growth picks up, as we expect,” he said.

In the latest sign of a booming job market, the Labor Department said unemployment claims remained near four-and-a-half decade lows last week, dropping by a thousand to a seasonally

Read More Here...

Bookmark the permalink.