By Anora Mahmudova and Barbara Kollmeyer, MarketWatch
Burlington Stores Inc. jumps on earnings beat
NEW YORK (MarketWatch) -- U.S. stocks were off session lows but
still broadly lower on Tuesday, with the Dow industrials suffering
a triple-digit loss.
However, the tech-heavy Nasdaq Composite broke into the green
with the help of Apple Inc., which jumped nearly 2%.
Investors wrestled with jitters as the Federal Open Market
Committee two-day meeting on Tuesday got under way, with many
expecting the central bank to pave the way to an interest-rate hike
as early as this summer by removing the word "patient" from its
statement.
The S&P 500 (SPX) was down 0.3% at 2,074, with nine of its
10 main sectors trading in negative territory. The technology
sector was the only sector in the green.
The Dow Jones Industrial Average (DJI) was down 127 points, or
0.7%, to 17,850, with nearly all of its 30 members posting
losses.
The Nasdaq Composite's (RIXF) added 0.1% to 4,935.04.
"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)
Diane Jaffee, senior portfolio manager at TCW, an asset manager
with $7 billion under management, said much of the market expects
the word "patient" to be removed from the central bank's
statement.
"After lower consumer sentiment figures, markets think the Fed
will keep 'patient' and if it does not, that we are in for a
selloff," Jaffee said. "But ultimately, the Fed will start raising
rates sometime this year and markets will go through rough
patches," she added.
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 missed
earnings and sales 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) jumped 1.8% 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.
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) settled at the lowest level
since November, foaling 0.4% to $1,148.20. The greenback (DXY) gave
back some ground against major currencies on Tuesday.
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