Stocks struggle ahead of Fed
Markets await the central bank's policy statement. Spanish and Italian 10-year bond yields ease. The Bank of England leans toward stimulus measures. Procter & Gamble cuts its outlook.
By Andrea Tse
Stocks wavered Wednesday as investors awaited the outcome of the latest Federal Reserve meeting.
Stocks jumped Tuesday, with the S&P 500 soaring to a one-month high, as risk-tolerant investors bet that additional fiscal stimulus is forthcoming from the Fed.
"The Fed offers a moment of economic sanity with its rate decision," said Paul Donovan, a global economist at UBS, ahead of the conclusion of the Fed's two-day meeting."
"If the Fed does nothing but hints . . . that further action may come as soon as the Aug. 1, 2012, FOMC meeting, the markets would still likely be disappointed," said John Canally, an economist for LPL Financial. "The markets' focus then would shift to Bernanke's press conference and back to the Fed's new economic forecast as participants try to gauge the timing of the next round of stimulus."
After the Federal Open Market Committee meeting, the Federal Reserve will post its statement at 12:30 p.m. ET, followed by the outlook of policymakers on the Fed funds rate and economy at 2 p.m. Fed Chairman Ben Bernanke is expected to address the press at 2:15 p.m.
Asian markets settled higher in anticipation of the outcome of the Fed meeting. Hong Kong's Hang Seng index settled up 0.53%, and Japan's Nikkei average closed higher by 1.11%.
The FTSE in London was up by 0.56%, and the DAX in Germany was up 0.31%, with the euro gaining a bit of traction.
The FTSE was edging higher as data showed that employment in the United Kingdom increased to the highest level in more than three years in April and as minutes from the Bank of England's last policy meeting indicated that the central bank is very close to supporting more monetary stimulus for the economy.
Both Spanish and Italian 10-year yields were easing Wednesday.
Eurozone leaders said at the Group of 20 summit of industrialized nations in Mexico this week that they will strive to reach an agreement on integrating their regional banks by December.
In Greece, there looked to be significant progress in forming a coalition among pro-bailout parties.
August crude oil futures were down 9 cents at $84.26 a barrel. August gold futures were slipping $7.40 to $1,615.80 an ounce.
The benchmark 10-year Treasury was down 2/32, raising the yield to 1.627%, while the dollar was trading sideways, according to the dollar index.
In corporate news, Adobe Systems (ADBE), the publishing software maker, provided a disappointing outlook for its fiscal third quarter on Tuesday because of a weaker demand forecast for Europe. Adobe forecast non-GAAP earnings of 56 cents to 61 cents a share for the three months ending in August on revenue of $1.075 billion to $1.125 billion. Analysts forecast profit of 61 cents a share on revenue of $1.133 billion.
Procter & Gamble (PG), the consumer-products giant, reduced its fourth-quarter profit and revenue forecasts because of slower-than-anticipated sales growth in developed markets.
P&G said Wednesday it expects to post core earnings for the quarter ending in June of 75 cents to 79 cents a share. Its previous estimate was 79 cents to 85 cents a share.
Analysts forecast core earnings of 82 cents a share in P&G's fiscal fourth quarter.
P&G said organic sales are expected to rise 2% to 3%. Its previous estimate was 4% to 5%.
The company said foreign exchange is expected to reduce net sales by 4%. Net sales are expected to be in the range of down 2% to 1%. It previously expected an increase of 1% to 2%.
Quest Software (QSFT) agreed to a higher buyout bid of $2.17 billion after Insight Venture Partners added Vector Capital as a new partner. The new bid is for $25.75 a share, up from a competing bid of $25.50 a share that was reportedly made by Dell (DELL).
Jabil Circuit (JBL) reported adjusted fiscal-third-quarter profit of 64 cents a share on revenue of $4.3 billion, in line with analysts' estimates.
More from TheStreet
- How to Invest $1,500: Go Cheap or Go Big?
- Will Surface Mean Poor Dell, HP Quarters?
- Cramer: Burger King Is Late to the China Game
I didn't mean to leave the impression that I limited big money donors to the
repubs. Although I think they may lead a litle in that category, the dems are just
as guilty. They are all after the best government money can buy, and its working for
Not so sure about the last Supreme Court ruling as to what CONSTITUTES "FREE"
speech, not because of its constitutionality but because of its reality.
When I give may small contribution of, lets say $ 25.00, I don't see or hear about
anbody 's ears purking up and listening to what I have to say.
But, when the Koch brothers or some of these other "FREE" speech avocates kick in millions,
probably even billions of dollars to the SUPER PACS, the ears in Washington begin to stand on end and the hearing aids go in so they can hears every word their saying. And soon those words are turned into actions through the lobbyists and reach those that can really make this "FREE" speech work for them. In other words giove them a big payday, often at the expense of somebody like me whose $ 25.00 got lost in the blare of the large donors.
"FREE" speech my A**. Its only free for those that can afford it.
Inflation leads to deflation... Didn't we just experience that with the housing bubble??? Stimulating the economy by pumping more wasteful government spending into it only kicks the can further down the road, and leads to an even bigger bust (eventually).
The proper, Webster's Dictionary definition of an investor, and what most of those who have money in the Market beyond their 401k's that i have run into here do.
You are not "investing."
Jamie Dimon has gotten too many free rides now, a friggin liar, like all of his ilk.
Even at the shareholders meeting...Explanations and excuses for the $2 billion losses, shareholders allowing him to keep his job......Then within a day or two of annoucing an increase of 50% more losses, on top of, bringing totals to $3 Billion down the drain..
Congressional Hearings.....How fruitful was that?
Infantile and juvenile questions.....Allowing Dimon to Monkey dance them, bobbing and swaying...
And we elect and pay these azzholes to do WHAT ??
our government subsidizes every big business...... sad use of our tax money. we pay ~ they write the checks. then they ask for more......
>>>>My favorite is the article decrying Jamie Dimon and JPM Chase as a welfare recipient.<<<<
Let's get our head together, dump "big" and get going forward again.
Just amazing what is considered GOOD NEWS these days.....
UE rate still above 8% - check
GDP hovering around 2% - check
FedEx and P&G forecasting a global slowdown - check
Greece asking for more time to implement austerity - check
Spanish bond rates soaring - check
Looming fight over raising the debt ceiling/tax cuts/spending cuts - check
Housing still in a slump - check
Downgrade of US banks who are holding tons of Euro paper - check
All of this adds up to one thing - more stimulus from the Fed, which should mean at least another 5-10% to the upside for stocks.
If you're not convinced that the newly-elected Greeks can form a coalition and build a new gov by the next deadline, it could be a prime spot to short the Euro....
Copyright © 2013 Microsoft. All rights reserved.
Quotes are real-time for NASDAQ, NYSE and AMEX. See delay times for other exchanges.
Fundamental company data and historical chart data provided by Thomson Reuters (click for restrictions). Real-time quotes provided by BATS Exchange. Real-time index quotes and delayed quotes supplied by Interactive Data Real-Time Services. Fund summary, fund performance and dividend data provided by Morningstar Inc. Analyst recommendations provided by Zacks Investment Research. StockScouter data provided by Verus Analytics. IPO data provided by Hoover's Inc. Index membership data provided by SIX Financial Information.
[BRIEFING.COM] The major averages ended modestly lower with the S&P 500 shedding 0.3%.
The benchmark average saw an opening loss of 1.2% after Japan's Nikkei tumbled 7.3%. Japanese stocks sold off amid continued volatility in Japanese Government Bond futures as the 10-yr yield spiked almost 16 basis points to 1.002 before the Bank of Japan's JPY2 trillion liquidity injection caused yields to retrace their gains.
Adding insult to injury was news out of China where the HSBC ... More
More Market News
|There’s a problem getting this information right now. Please try again later.|
LATEST MARKET DISPATCHES
- No more Dispatches; here's where to find market news
The Market Dispatches column has been discontinued. Here's where to find the latest stock and business news on MSN Money, and the latest from market writer Charley Blaine.
- Dow falls 59 as late-day gloom kills a rally
- Stocks held back by fiscal-cliff worries
- Stocks suffer worst weekly loss in 5 months
- Dow off 121 as post-election swoon continues
- Dow slumps 313 after Obama's re-election
- Dow jumps 133 as Americans head to the polls
In the never-ending contest for sales, American carmakers are pulling ahead.