Breaking News
Get Actionable Insights with InvestingPro+: Start 7 Day FREE Trial Register here
Investing Pro 0
Ad-Free Version. Upgrade your Investing.com experience. Save up to 40% More details

S&P 500, Dow Stage Another Turnaround as Fed Meeting Gets Underway

Stock MarketsJan 25, 2022 02:48PM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
© Reuters.

By Yasin Ebrahim

Investing.com – The S&P 500 and Dow staged another intraday turnaround Tuesday, with energy and financials leading the way ahead of the Federal Reserve’s monetary policy update due Wednesday.  

The S&P 500 fell 0.2%, but had been down more than 1% intraday. The Dow Jones Industrial Average gained 0.6%, or 206 points, erasing an 800-point decline. The Nasdaq was also off its lows, down about 0.8%.

The Federal Reserve kicks off its two-day meeting Tuesday. While the Fed is expected to keep its benchmark rate on hold, investors are waiting with bated breath to discover whether the recent pricing in of a more aggressive tightening of monetary policy is warranted.

Investors will be watching "If Fed chairman Jerome Powell continues to address the risk of inflation as heightened and any sort of communication about ending the taper early," John Luke Tyner, Portfolio Manager at Aptus Capital Advisors said in an interview with Investing.com on Tuesday. If the Fed hints "at any plan of how they'll use the balance sheet to reduce accommodation that is going to be huge."

In anticipation of a hawkish tone on policy from the Fed, U.S. bonds yields were on the rise, with U.S. 10-year yield briefly flirting with 1.8%, boosting rate-sensitive sectors like banks.

Zions (NASDAQ:ZION), Discover Financial Services (NYSE:DFS) and American Express (NYSE:AXP) led the move higher in financials, with latter receiving an added boost after delivering quarterly results that beat on both the top and bottom lines.

American Express reported better-than-expected quarterly earnings of $2.18 per share on $12.15 billion in revenue, well above Wall Street estimates for $1.87 and $11.5 billion, respectively.

Energy, however, was the standout performer rising more than 3%, underpinned by fears about potential supply disruptions as geopolitical tensions in Eastern Europe and the Middle East continue to rise.

The gains in the cyclical stocks like energy and financials contrasted with losses in growth sectors like tech, which could continue its trend lower amid a rising interest rate environment.

But there could be respite ahead for higher quality tech names boasting strong earnings and robust balance sheets.

“Rising interest rates might impact a company that doesn't have earnings, but for companies like Microsoft or like Apple and some of the really high-quality growth names, one and a half percent and 2% on the 10-year yield doesn't really matter,” said Tyner.

Microsoft (NASDAQ:MSFT) was down less than 1% ahead of its quarterly results due after the closing bell. Its cloud business, Azure, is expected to have bolstered results in fourth quarter.

"We expect another strong result [...] led by ongoing Azure momentum and M365 tailwinds,” Deutsche Bank said in a note.

International Business Machines (NYSE:IBM) rose nearly 6% after delivering a beat on both the top and bottom lines, though some of the growth driven by sales to Kyndryl.

In other earnings news, General Electric (NYSE:GE) fell more than 4% after reporting revenue that missed Wall Street estimates as supply chain disruptions weighed on performance.

Johnson & Johnson (NYSE:JNJ), meanwhile, reported mixed quarterly results as revenue fell short of analysts’ estimates, but the company projected its covid vaccine would generate $3 billion to $3.5 billion in sales in 2022. Its shares were up more than 3%.

S&P 500, Dow Stage Another Turnaround as Fed Meeting Gets Underway
 

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Comments (8)
Mitchel Pioneer
Mitchel Pioneer Jan 25, 2022 4:22PM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Fraudulent, criminally manipulated joke.
Chad RicherThanYou
Chad RicherThanYou Jan 25, 2022 3:48PM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Total collapse of the USA soon
Church of Bear Market
Church of Bear Market Jan 25, 2022 3:28PM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Classical Wyckoff-pattern on stock indices. We just last point of supply. Bear times ahead.
Cardinal Sin
Cardinal Sin Jan 25, 2022 3:09PM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Europe closes, PPT jumps in...!
Peter ONeill
Peter ONeill Jan 25, 2022 3:08PM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Still far too much money / Fed QE splooshing around to allow the market to natural fall. Say be another 12+ months before the market is at more natural levels
Stan Smith
Stan Smith Jan 25, 2022 3:02PM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Wow...miracles happen twice in 24 hours. FED just doing God's work!
ozokaba zeros
ozokaba zeros Jan 25, 2022 3:02PM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
he is really doing God's work
Church of Bear Market
Church of Bear Market Jan 25, 2022 3:02PM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
I beg to differ
Stan Smith
Stan Smith Jan 25, 2022 3:02PM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Jon Bal
Jon Bal Jan 25, 2022 3:01PM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
oh mitchell, where are youuu
Mitchel Pioneer
Mitchel Pioneer Jan 25, 2022 3:00PM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Another miracle for the BIGGEST INVESTMENT JOKE IN THE WORLD.
jake goldstein
jake goldstein Jan 25, 2022 3:00PM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
it's impossible.Fraud only explaination and FED prime suspect.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Continue with Google
or
Sign up with Email