Dow, S&P end lower; Fed statement awaited

Reuters New York | Updated on January 24, 2018 Published on March 18, 2015

New York, March 18 The Dow and the S&P 500 fell on Tuesday as materials shares declined and nervousness increased ahead of a Federal Reserve statement, while the Nasdaq ended higher.

Stocks cut losses in afternoon trading, led by a rise in tech shares. The S&P 500 technology index ended up 0.1 per cent, helped by gains in Apple, up 1.7 per cent at $127.04, and Facebook, up 1.7 per cent at $79.36.

After the bell, shares of Oracle rose 3.4 per cent to $44.33 following results.

Fed statement

Investors were anxious as the Federal Open Market Committee kicked off a two-day policy meeting, to be followed by a statement from Fed Chair Janet Yellen on Wednesday afternoon.

Most economists expect the Fed to remove a pledge to be “patient’’ about raising interest rates from its statement. Market strategists said with or without a change in the language, the Fed may still be on track to raise rates as early as June.

“People are waiting for the Fed to provide some degree of clarity,’’ said Michael O'Rourke, chief market strategist at JonesTrading in Greenwich, Connecticut.

Among S&P 500 sectors, materials was the weakest with a 1.2 per cent decline, led by DuPont, down 3.1 per cent at $74.68.

The Dow Jones industrial average fell 128.34 points or 0.71 per cent to 17,849.08, the S&P 500 lost 6.91 points or 0.33 per cent to 2,074.28 and the Nasdaq Composite added 7.93 points or 0.16 per cent to 4,937.44.

Options expiry

In addition to anxiety about the Fed statement, options expiration on Friday may have contributed to the day’s volatility, said Bruce Zaro, chief technical strategist, Bolton Global Asset Management in Boston.

While higher rates would be a sign of strength in the US economy, some investors question whether the economy is strong enough to handle increased borrowing costs.

The S&P 500’s pullback followed its biggest percentage gain since February 3 on Monday.

Johnson & Johnson weighed most heavily on the S&P 500 with a 1.2 per cent decline to $99.89.

Also boosting the Nasdaq, shares in American Airlines jumped 6.9 per cent to $53.69 after an announcement that it would join the S&P 500.

About 6.1 billion shares changed hands on U.S. exchanges, below the 6.6 billion average for the month to date, according to BATS Global Markets.

Declining issues outnumbered advancing ones on the NYSE by 1,607 to 1,429, for a 1.12-to-1 ratio; on the Nasdaq, 1,384 issues rose and 1,330 fell, for a 1.04-to-1 ratio favouring advancers.

The S&P 500 posted 26 new 52-week highs and three new lows; the Nasdaq Composite recorded 112 new highs and 62 new lows.

Published on March 18, 2015
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