On Wednesday, U.S. stocks closed mixed after the Federal Reserve hinted at keeping interest rates near zero through 2022. The Nasdaq 100 charged 127 points (+1.3%) higher to 10094, a fresh record close. The Dow Jones Industrial Average lost another 282 points (-1.0%) to 26989, and the S&P 500 dropped 17 points (-0.5%) to 3190.
S&P 500 Index Daily Chart
Source: GAIN Capital, TradingView
Software & Services (+2%), Technology Hardware & Equipment (+1.59%) and Semiconductors & Semiconductor Equipment (+0.92%) sectors performed the best, while Banks (-5.75%), Energy (-4.92%) and Consumer Services (-3.23%) sectors lagged behind.
Tesla (TSLA +8.97%), Apple (AAPL +2.57%) and Amazon.com (AMZN +1.79%) closed at record highs.
On the technical side, about 58.3% (68.8% in the prior session) of stocks in the S&P 500 Index were trading above their 200-day moving average, and 93.3% (94.7% in the prior session) were above their 20-day moving average.
As expected, the Federal Reserve kept its key rate unchanged at 0.00%-0.25%. At the same time, the central bank said it expects the U.S. economy to contract by 6.5% this year and rebound 5.0% in 2021.
Official data showed that U.S. Consumer Prices declined 0.1% on month in May (+0.0% expected).
Later today, Producer Price Index (+0.1% on month in May expected), Initial Jobless Claims (a fall to 1.550 million expected) and Continuing Claims (a fall to 20.000 million expected).
European stocks still lacked upward momentum, with the Stoxx Europe 600 Index slipping 0.4%. Germany's DAX fell 0.7%, France's CAC dropped 0.8%, and the U.K.'s FTSE 100 edged down 0.1%.
U.S. Treasury prices remained firm after the Fed projected no interest-rate rises through 2022. The benchmark 10-year Treasury yield sank further to 0.744% from 0.829% Tuesday.
Spot gold jumped $23.00 (+1.4%) to $1,737 an ounce, extending its winning streak to a third session.
Oil prices climbed higher despite U.S. Energy Information Administration's weekly report that the country's crude-oil stockpiles rose to a record level of 538.1 million barrels. U.S. WTI crude oil futures (July) added 1.6% to $39.56 a barrel.
On the forex front, the ICE U.S. Dollar Index slid 0.4% on day to 96.05, amid Fed's commitment to low interest rates and asset purchases.
EUR/USD gained 0.3% to 1.1380, posting a three-day rally.
GBP/USD edged up 0.1% to 1.2747.
USD/JPY dropped 0.8% to 106.91, down for a third straight session. This morning, government data showed that Japan's first quarter BSI All Industry Business Condition Index for large firms sank to -47.6 (-38.4 expected) from -10.1 in the prior quarter.
Disclaimer: The information on this web site is not targeted at the general public of any particular country. It is not intended for distribution to residents in any country where such distribution or use would contravene any local law or regulatory requirement. The information and opinions in this report are for general information use only and are not intended as an offer or solicitation with respect to the purchase or sale of any currency or CFD contract. All opinions and information contained in this report are subject to change without notice. This report has been prepared without regard to the specific investment objectives, financial situation and needs of any particular recipient. Any references to historical price movements or levels is informational based on our analysis and we do not represent or warranty that any such movements or levels are likely to reoccur in the future. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness, nor does author assume any liability for any direct, indirect or consequential loss that may result from the reliance by any person upon any such information or opinions.
Futures, Options on Futures, Foreign Exchange and other leveraged products involves significant risk of loss and is not suitable for all investors. Losses can exceed your deposits. Increasing leverage increases risk. Spot Gold and Silver contracts are not subject to regulation under the U.S. Commodity Exchange Act. Contracts for Difference (CFDs) are not available for US residents. Before deciding to trade forex and commodity futures, you should carefully consider your financial objectives, level of experience and risk appetite. Any opinions, news, research, analyses, prices or other information contained herein is intended as general information about the subject matter covered and is provided with the understanding that we do not provide any investment, legal, or tax advice. You should consult with appropriate counsel or other advisors on all investment, legal, or tax matters. References to Forex.com or GAIN Capital refer to GAIN Capital Holdings Inc. and its subsidiaries. Please read Characteristics and Risks of Standardized Options.