December 11, 2023


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Wall Street was little changed as investors eyed yields, according to comments from the Federal Reserve

Wall Street was little changed as investors eyed yields, according to comments from the Federal Reserve

A trader works on the floor at the New York Stock Exchange (NYSE) in New York City, US, October 27, 2023. REUTERS/Brendan McDiarmid/File Photo Obtaining licensing rights

  • Warner Bros Discovery is on disappointing expectations
  • Lucid Group fell as production forecasts were cut
  • The Dow Jones falls 0.19%, the Standard & Poor’s falls 0.04%, and the Nasdaq rises 0.07%.

Nov 8 (Reuters) – U.S. stocks were little changed on Wednesday as investors digested recent comments from Federal Reserve officials, looking for signs on the path of interest rates and focusing on the direction of Treasury yields.

US Treasury yields have fallen sharply from recent highs. Benchmark 10-year Treasury bonds rose 5% amid growing expectations that the Federal Reserve has reached the end of its rate-hiking cycle, supported by a weaker-than-expected jobs report. The decline helped fuel a rally in stocks, pushing the S&P 500 (.SPX) and Nasdaq (.IXIC) to their longest streak of gains in two years through Tuesday’s close.

Markets expect about a 50% chance of interest rates being cut by at least 25 basis points in May, according to a CME Group report. Feedwatch toolup from about 41% the previous week.

However, comments from several central bank officials over the past few days have left the door open for further increases, causing some uncertainty among investors.

Jason Weir, chief investment officer at Albion Financial Group, said: “Everyone knows we’re either going to get another interest rate rise or they’re done, and they’re probably done.”

“If we get a recession, stocks will have a different valuation, and earnings will look different. If that doesn’t happen, we’re probably in the context of a new, early-stage bull market here,” he said.

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“This is the question investors will be asking themselves as they watch yields – the information we get between now and the end of the year on yields and recession-related economic data will move the bar.”

The Dow Jones Industrial Average fell 63.47 points, or 0.19%, to 34,089.13 points, the Standard & Poor’s 500 Index increased 1.90 points, or 0.04%, to 4,380.28 points, and the Nasdaq Composite Index advanced 9.15 points, or 0.04%. 0.07% at 13649.01

Meanwhile, Federal Reserve Chairman Jerome Powell did not comment on monetary policy in his opening remarks at the US central bank’s statistics conference on Wednesday. He is scheduled to speak at another conference on Thursday.

The 10-year Treasury yield barely moved after a $40 billion auction that analysts described as modest.

In earnings, Warner Bros. Discovery shares fell 17.1% after the company said that strikes in Hollywood and weakness in the advertising market may hurt profits next year, affecting its counterpart Paramount Global, which fell 8.2%.

Technology companies (.SPLRCT) led gains among the S&P’s 11 major sectors, while energy (.SPNY) and utilities (.SPLRCU) were the weakest, each losing more than 1%.

Take-Two Interactive Software (TTWO.O) shares jumped 6.4% after the company said it will release a trailer early next month for the latest installment in the best-selling “Grand Theft Auto” video game series.

Electric car maker Lucid Group’s shares stumbled 8.3% after it lowered its production expectations.

Down issues outnumbered gainers 1.3 to 1 on the NYSE while on the NASDAQ, down issues outnumbered gainers 1.7 to 1 on the NASDAQ.

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The S&P 500 recorded 15 new 52-week highs and five new lows while the Nasdaq recorded 52 new highs and 173 new lows.

Reporting by Chuck Mikolajczak; Edited by Richard Chang

Our standards: Thomson Reuters Trust Principles.

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