Global Equity Markets Rally In Wake Of Hawkish Fed Meeting
- Author: Anthony Vega Sep 23, 2017,
Sep 23, 2017, 0:31
PNC Financial Services rose 1.3 percent. Tesla (TSLA.O) fell 2.6 percent after Jefferies started coverage of the electric vehicle maker's stock with an "underperform" rating. Shares of Apple fell 1.7% after it admitted its latest smartwatch has connectivity problems. MSCI's gauge of stocks across the globe .MIWD00000PUS shed 0.25 percent.
So far this month, the 2-year Treasury yield has climbed more than 10 basis points, the benchmark 10-year note yield has tacked on more than 12 basis points, while the yield on the 30-year bond has advanced about 6 basis points, thus far in September.
The S&P 500 climbed only modestly in Tuesday night's Wall Street session, the ASX is trading in a tight range and the U.S. dollar slipped slightly against nearly all G-10 currencies - extending its 2017 trend.
High-dividend stocks like household goods makers and utilities fell the most Wednesday afternoon.
The five-year Treasury yield was trading at 1.860-a fall of ~1.4%.
The Aussie was hurt after Reserve Bank of Australia Governor Philip Lowe said on Thursday that the central bank does not have to follow a general move globally to raise interest rates. Bank of America rose 1.4 percent.
But these rather dramatic moves in bond prices are not harbingers of a more rapid sell-off as the Fed unwinds its bloated balance sheet.
The pan-European FTSEurofirst 300 index .FTEU3 lost 0.18 percent.
TECH RISING: Technology stocks were also among the big gainers.
However, the Fed lowered its rate forecast for 2019 to 2.7% from 2.9%.
Also weighing on Australian stocks but helping those in Japan was a jump in the USA dollar which dragged down metals prices.
Bed Bath & Beyond sank 17 percent to its lowest since 2009 after the home furnishing retailer reported earnings and sales below estimates, prompting a slew of price target cuts.
The euro edged up 0.1 percent to $1.1957 and was also up 0.1 percent for the week.
The USD/JPY pair was slightly negative on Tuesday, as the market continues to be volatile, but as we wait for the results of the Federal Reserve meeting, it should be noted that this is going to be very influential on this market.
Brent crude futures were up 0.3 percent at $55.30 a barrel and US crude rose 0.6 percent to $49.76 a barrel. ConocoPhillips gained 1.3 percent.
On the downside, Best Bath & Beyond Inc., (NASDAQ:BBBY) fell 15.9% after second-quarter revenues and gross margins missed estimates on a deeper-than-expected comp-store sales decline. Aetna slid $5.34, or 3.3 percent, to $155.67.
Stocks were set to open flat at 0700 GMT, with the JSE securities exchange's Top-40 futures index barely changed.
The Dow Jones industrial average slipped 7 points, less than 0.1 percent, to 22,363. Hong Kong's Hang Seng was little changed at 28,162.32, while the Shanghai Composite dipped 0.2 percent to 3,355.96.
Torsten Slok, chief global economist at Deutsche Bank in NY, agrees that the next rate hike could be delayed a quarter or two due to the hurricanes, but the economic effect is temporary.