S&P 500 and Dow close at records
US stock indices closed lower on Wednesday after the Federal Reserve raised the federal funds rate and indicated it would start reducing its balance sheet “this year”. The dollar ended little changed: the live dollar index data show the ICE US Dollar index, a measure of the dollar’s strength against a basket of six rival currencies, inched down less than 0.1% to 96.935. S&P 500 edged down 0.1% settling at 2437.92 with five out of benchmark’s 11 main sectors finishing in negative territory led by energy stocks, down 1.8%. The Dow Jones industrial average closed at a record for a second straight session rising 0.2% to 21374.56 led by gains in shares of Goldman Sachs (NYSE:GS), The Travelers Companies Inc (NYSE:TRV) and Home Depot (NYSE:HD). The NASDAQ Composite index fell 0.4% closing at 6194.893.
Rebound in technology stocks lifts European markets
European stock indices advanced on Wednesday led by technology and industrial stocks. The euro edged higher while the British Pound extended losses against the dollar. The Stoxx Europe 600 index rose 0.5%. The DAX 30 closed 0.5% higher at 12827.77. France’sCAC 40 outperformed gaining 0.9% and UK’s FTSE 100 added 0.3% to 7520.73.
Asian stocks slip
Asian stock indices are mostly lower today following a more hawkish than expected Federal Reserve statement. Lower May inflation and retail sales data earlier in the day spurred expectations the central bank may signal a slowing of further tightening pace, but policy makers’ projections of the rate hike path indicated they still expect one more rate hike by the end year. Nikkei closed 0.3% lower at 19831.82 today with the yen extending gains against the dollar. The Chinese stocks are mixed as China's central bank left interest rates unchanged : the Shanghai Composite Index is up 0.06% while Hong Kong’s Hang Seng Index is 1% lower. Australia’s ASX All Ordinaries is down 1.1% as Australian dollar extended gains against the greenback and lower oil prices hurt energy and commodity stocks.
Oil down on oversupply concerns
Oil futures prices are extending losses today as concerns mount about OPEC’s ability to cut output and global oversupply continues with US output projected to rise more. OPEC output has increased after the May 25 extension of the output cut agreement till the end of first quarter next year as output increased in Nigeria, Libya and Iraq. The US Energy Information Administration raised its prediction for US output growth in 2017 to 460000 barrels per day (bpd) from a predicted decline of 80000 bpd in December. Oil prices fell to seven month low on Wednesday after US government data showed a smaller than expected decline in domestic supplies and an increase in gasoline stockpiles and crude production. The US Energy Information Administration reported that US crude supplies fell by 1.7 million barrels last week while gasoline stockpiles rose 2.1 million barrels. August Brent crude fell 3.5% settling at $47.00 a barrel on London’s ICE Futures exchange on Wednesday.