The main indexes of the New York Stock Exchange ended today’s trading session with declines after the US Federal Reserve killed the hopes for lowering key interest rates.
The blue-chip index Dow Jones Industrial Average fell by 162.77 points, or 0.61%, ending the day at 26,430.14 points. The broader S&P 500 declined by 0.75% to 2,923.73 points. The technology benchmark Nasdaq Composite fell by 45.75 points, or 0.57%, to 8,049.64 points.
The Federal Open Market Committee kept the key interest rate unchanged, indicating that interest rates are unlikely to increase in the coming months. The Federal Reserve kept its interest rate on consumer and business loans at 2.25-2.50%.
The Federal Open Market Committee said the economy is in good condition.
Fed Chairman Jerome Powell said in a news conference that recently low inflationary pressures may only be “transitory”, dashing speculation the central bank was at least entertaining the idea of a rate cut because of tame inflation.
Stocks rose broadly earlier in the day following positive news on trade. The US-China trade deal could be announced by next Friday. Strong earnings from companies like of Apple’s quarterly results and strong jobs data for April boosted sentiment as well.
ADP and Moody’s Analytics said private payrolls increased by 275,000 in April, easily blowing by a Dow Jones estimate of 177,000. The strong gain was led by an increase of 223,000 in payrolls within the services sector.
Treasury yields rebounded on Powell’s comment. The 2-year yield went from a session low of around 2.2% to trade back at 2.27%. The yields on 10-year and 30-year US government bonds fell to 2.504% and 2.908%, respectively.
Corporate stocks performance
The stocks of the technology giant Apple rose by 4.9% after the company managed to surpass analysts’ forecasts for earnings and profit in the first quarter of the year.
Mondelez’s stock also rose by 1.6% on account of the company’s report, which surpassed estimates from market experts.
Shares of CVS Health Corp rallied by 5.4% after the pharmacy and health-care services giant reported first-quarter earnings and sales that beat Wall Street expectations while raising its outlook for the full-year 2019.
The stocks of Estee Lauder fell by 0.9%, reversing early morning gains as high as 4.9% after the makeup manufacturer reported first-quarter sales that beat analyst expectations while predicting revenue would grow between 7% and 8% during the full-year 2019.
Shares of Humana Inc retreated 3.6%, even after the insurer reported first-quarter earnings and revenue Wednesday morning that topped Wall Street expectations, while also raising its full-year guidance.
Yum! Brands Inc stocks fell by 2.4%, while Royal Caribbean Cruises rose by 6.7% after strong first-quarter results.
Hotel operator Hilton Worldwide Holdings added 6.5% to its market value after announcing first-quarter earnings growth of 16% well above Wall Street forecasts.
Molson Coors Brewing wiped out 7.5% of its market capitalization after the company reported first-quarter earnings that fell short of forecasts.
Corporate earnings reports
Qualcomm shares fell Tuesday after the chip maker topped estimates for the quarter and included the settlement with Apple in its guidance. The company reported fiscal second-quarter net income of 663 million USD, or 0.55 USD per share, compared with 330 million USD, or 0.22 USD per share, in the year-ago period. Adjusted earnings were 0.77 USD per share. The revenue declined to 4.98 billion USD from 5.22 billion USD in the year-ago quarter.
Revenue of Apple fell by 5% YoY to 58 billion USD, coming in toward the high end of management’s guidance range for fiscal second-quarter revenue of between 55 billion USD and 59 billion USD. Once again, revenue was weighed down by lower iPhone revenue, which accounted for 54% of total revenue during the period. Furthermore, since iPhone contributes outsize gross profit to the tech giant’s overall results, lower revenue from the segment hurt Apple’s profitability.