Stocks Waver Ahead of Fed Decision
October 30 2019 - 10:02AM
Dow Jones News
By Will Horner
Global stocks wavered amid a raft of major corporate earnings
Wednesday as investors also awaited the Federal Reserve's decision
on interest rates.
The Dow Jones Industrial Average traded up 6 points in early New
York trading, while the S&P 500 and the Nasdaq Composite added
less than 0.1%.
General Electric raised its cash-flow outlook for the year,
sending its shares more than 8% higher in premarket trading.
Johnson & Johnson shares rose 2.8% off hours after it said
Tuesday that a test of its baby powder didn't find traces of
asbestos, rebutting U.S. regulators' claims about the product.
Stryker dropped 3.2% after mounting expenses led to a drop in
the medical-device maker's earnings. Advanced Micro Devices fell
1.4%. The chip maker issued a forecast for the current quarter late
Tuesday that was slightly lower than expected.
A raft of major U.S. companies, including Apple, Facebook, Lyft
and Starbucks, are poised to report through the day. There is also
widespread expectation that the central bank will cut interest
rates by a quarter of a percentage point after markets close.
While many investors see the 0.25% rate cut as a foregone
conclusion, they will look closely to see how the central bank
frames the cut and what signals Chairman Jerome Powell provides
about monetary policy, according to Geoffrey Yu, head of the U.K.
office of UBS's investment arm.
"The market is looking for signs about how committed the Fed is
to support policy further," Mr. Yu said. "Everybody knows the Fed
has room to lower rates further, the question is how willing are
they?"
Meanwhile, the pan-continental Stoxx Europe 600 index was also
mostly flat, with some of the region's biggest banks posting
declines.
Shares of troubled German lender Deutsche Bank fell 5.7%, their
biggest drop since December, after it said efforts to overhaul its
global operations had taken a large chunk out of its revenue. Banco
Santander declined 5% as third-quarter profit fell 75%.
Fiat Chrysler Automobiles and Peugeot maker PSA Group surged
after the companies confirmed they were discussing a merger that
would create the world's fourth-largest auto maker by volume. Fiat
shares rose 9.5% in Milan and PSA gained 5.4%. Rival Renault, which
had previously received an offer to combine its operations with
Fiat, slumped 4.7%.
In the U.K., major stock indexes slipped after lawmakers agreed
to hold an early election on Dec. 12 in an attempt to break the
stalemate over Brexit. The FTSE 250 gauge slipped 0.4%, while the
yield on U.K. government bonds fell to 0.696%. Bond yields fall as
prices rise. The British pound ticked up 0.2%.
In Asia, the Shanghai Composite Index fell 0.5%, while Japan's
Nikkei 225 gauge dropped 0.6%.
(END) Dow Jones Newswires
October 30, 2019 09:47 ET (13:47 GMT)
Copyright (c) 2019 Dow Jones & Company, Inc.
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