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Dow Jones Industrial Average Hits Record High After Fed Rate Hike

16 June, 2017, 06:30 | Author: Melinda Barton
  • The Nasdaq slumped 1% late Wednesday's after the Fed as expected hiked its key lending rate by a quarter point

US retail sales dropped 0.3% in May, the biggest decline in 16 months.

USA stocks dipped Wednesday as investors anxious about weak retail sales and oil prices sank.

A weaker-than-expected reading on U.S. consumer prices sent United States government bonds sharply higher, as the data sowed doubts about the likely pace of central bank rate hikes later in the year just hours before it was expected to raise them for a second time in 2017.

"It's a Fed day and the markets will likely not blink an eye as the FOMC raises rates by 25 basis points", said Peter Cardillo, chief market economist at First Standard Financial in NY.

The data also pressured the dollar index, which fell to its lowest since November 9.

"I think some Fed members are going to be skeptical about raising rates for the third time later this year, but I don't think they will step up and say they shouldn't be doing it today".


Investors will also be looking for any details on the Fed's plans to trim its $4.5 trillion balance sheet in the face of improving economic conditions.

"Armenpress" reports the value of Dow Jones up by 0.22% to 21374.56 points, S&P 500 down by 0.10% to 2437.92 points, Nasdaq down by 0.41% to 6194.89 points. The index had hit a record intraday high of 21,354.56 shortly after the open. Meanwhile, the yield on the 10-year Treasury note declined 7 basis points to to 2.14%, its lowest level since November.

The broad-based S&P 500 dipped 0.2 percent to end at 2,432.46, while the tech-rich Nasdaq Composite Index fell 0.5 percent to 6,165.50.

"The data show a stronger likelihood for the best-performing funds to become the worst-performing funds than vice versa", S&P Dow Jones Indices said.

Traders work on the floor of the New York Stock Exchange June 2, 2017.

Johnson & Johnson rose 0.6 percent to $132.76 after the company's flu drug succeeded in a mid-stage trial. On the Nasdaq, 1,345 issues fell and 979 advanced.

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