The stock market in the United States declined as investors resumed their attention on the weakness of the commodities industry and the forecasts on global economic growth.
The WTI crude declined 1.94% to $34.83 per barrel, and the Brent crude fell 1.34% to $36.89 a barrel.
In an interview with Bloomberg, Walter Hellwig, a senior vice president at BB&T Wealth Management, commented, “Investors are focusing on some of the lingering issues with regard to stocks — falling price of oil and global weakness.” He also noted the existing doubts regarding earnings increases next year, which would cause concerns in the market.
David Einhorn's Greenlight Capital was down 0.1% for the first quarter, underperforming the S&P 500's 6.2% return. In their letter to investors, which was reviewed by ValueWalk, the Greenlight team said a lot happened during the first quarter even though they made just a handful of changes to the portfolio and essentially broke even. Q1 Read More
On the other hand, Frances Hudson, a global thematic strategist at Standard Life Investments, said, “The focus has moved away from what the Fed will do, that’s now history. It was delivered fine. On to the next thing, perhaps we’ll see more of a longer-term focus now on earnings in the U.S. and what the prospects are for 2016.”
Yesterday, the Federal Reserve raised interest rates, which was widely anticipated by investors. The members of the Open Markets Committee unanimously approved the increase in the federal funds rate at 0.25% to 0.5%. Policymakers said the monetary policy will remain accommodative after the rate hike to support further improvement in the labor market and the return to 2% inflation.
During a press conference, Federal Reserve Chairperson Janet Yellen, said, “The economic recovery has clearly come a long way, although it is not yet complete. The Committee currently expects that with gradual adjustments in the stance of monetary policy, economic activity will continue to expand at a moderate pace and labor market indicators will continue to strengthen.”
Today, the Department of Labor reported that the number of people who filed for unemployment benefits dropped by 11,000 to 271,000 for the week ended December 12.
David Berson, chief economist at Nationwide Insurance, said, “Claims are staying at historically very low levels, which shows the labor market is pretty tight. For the bulk of the economy, demand for workers is reasonably high. Companies are hesitant to let workers go.”
• Dow Jones Industrial Average (DJIA) – 17, 495.98 (-1.43%)
• S&P 500- 2,041.90 (-1.50%)
• NASDAQ- 5,002.55(-1.35%)
• Russell 2000- 1,137.68 (-0.98%)
• EURO STOXX 50 Price EUR- 3,306.47 (+1.84%)
• FTSE 100 Index- 6,102.54 (+0.68%)
• Deutsche Borse AG German Stock Index DAX- 10,738.12 (+2.57%)
• Nikkei 225- 19,352.56 (+1.59%)
• Hong Kong Hang Seng Index- 21,872.06 (+0.79%)
• Shanghai Shenzhen CSI 300 Index- 3,755.89 (+1.91%)
Stock market in Focus
The stock price of Oracle Corporation declined 5% to $36.93 per share. The company posted quarterly earnings of $0.63 per share, slightly higher than the $0.60 per share expected by analysts. Its revenue declined 6.3% to $8.99 billion, below the $9.06 billion consensus estimate.
General Mills fell more than 3% to $57.23 per share. The company’s quarterly sales were $4.42 billion, 4% lower than the expectations of analysts. Its earnings were $0.87 per share.
The stock value of Rewalk Robotics surged more than 83% to $11.00 per share, the biggest gainer on NASDAQ. The company benefited from the announcement of the Veterans Affairs that it would evaluate, procure, and train its personal exoskeleton systems for all veterans who meet the criteria.