By Anora Mahmudova and Barbara Kollmeyer, MarketWatch
Burlington Stores Inc. jumps on earnings beat
NEW YORK (MarketWatch) -- U.S. stocks moved sharply lower on
Tuesday, with the Dow industrials suffering a triple-digit loss
shortly after the opening bell.
Investors were nervous as the Federal Open Market Committee
two-day meeting begins on Tuesday, with many expecting the central
bank to pave the way to an interest-rate hike this summer by
removing the word "patient" from its statement.
A housing report pointing to a slump in new home construction
didn't help the already dour mood on Wall Street.
The S&P 500 (SPX) erased half of Monday's gains, with all 10
main sectors trading in negative territory.
The Dow Jones Industrial Average (DJI) dropped nearly 170
points, with nearly all of its 30 members posting losses.
The Nasdaq Composite's (RIXF) declined was more tempered.
"The sideways trading action since the end of QE is an
indication that people are confused about the economy. Tomorrow's
statement is unlikely to bring about any clarity to markets, as the
Fed is likely to replace the word 'patient' with 'slow path'
rhetoric," said Ed Shill, chief investment officer at QCI Asset
Management.
"But markets are absolutely wrong about the June-September rate
hike, because they have ignore one of the biggest words the Janet
Yellen has been saying all this time -- 'if'. The Fed will raise if
we see strong employment growth, wage growth and inflation at 2%.
But none of that is happening," Shill said.
In Tuesday's economic news, data showed construction on new U.S.
homes slumped in February
(http://www.marketwatch.com/story/housing-starts-slump-on-winter-weather-2015-03-17),
mostly due to harsh winter, but permits jumped, suggestion
construction will pick up in the spring.
Softer data over the past two months had pushed expectations of
a rate hike further out, resulting in markets rallying on 'bad
news," which was seen delaying a rate hike, and falling on "good
news." However, so far this year, the S&P 500 moved largely
sideways, rising less than 1% since the start of the year.
Read: Here's what to watch from the Fed this week
(http://www.marketwatch.com/story/heres-what-to-watch-from-the-fed-this-week-2015-03-16)
(http://www.marketwatch.com/story/heres-what-to-watch-from-the-fed-this-week-2015-03-16)Stocks
to watch:Burlington Stores Inc.(BURL) rose after the discount
retailer posted better-than-expected fourth-quarter profit and
revenue.
Plug Power Inc.(PLUGD) shares dropped after the company reported
a worse-than-expected fourth-quarter loss and sales that were
weaker than analysts' estimates.
Shares of American Airlines Group Inc. (AAL) jumped after
Standard & Poor's said late Monday that the airline will be
included in the S&P 500 index.
Apple Inc.(AAPL) is in the spotlight after The Wall Street
Journal, citing sources, reported that the tech company is in talks
with programmers
(http://www.marketwatch.com/story/apple-in-talks-to-launch-online-tv-service-2015-03-16-221031419)
to launch an online television service based on a slim bundle of TV
networks.
Later on Tuesday, Oracle Corp.(ORCL) and Adobe Systems
Inc.(ADBE) will report quarterly results.
Read more about stock action in the Movers & Shakers column
(http://www.marketwatch.com/story/oracle-adobe-burlington-stores-earnings-in-focus-2015-03-17).
Other markets: European stocks fell, with the Stoxx Europe 600
declining further after German ZEW economic sentiment data fell
short of expectations. In Asia, a strong run continued for certain
markets. The Nikkei 225 index scored a new 15-year closing high
(http://www.marketwatch.com/story/japanese-stocks-close-at-fresh-15-year-high-after-boj-decision-2015-03-17)
after the Bank of Japan stood pat on interest rates, while Shanghai
Composite Index stocks closed above the 3,500 mark for the first
time in nearly seven years.
Oil prices
(http://www.marketwatch.com/story/us-oil-prices-under-pressure-after-hitting-six-year-low-2015-03-17-31031510)(CLJ5)
continued to weaken, with WTI contract temporarily falling below
$43 a barrel, while gold prices (GCJ5) inched higher. The greenback
(DXY) gave back some ground against major currencies on
Tuesday.
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