by Lewis Krauskopf, Ankika Biswas and Shashwat Chauhan
(Reuters) – The New York Stock Exchange ended in mixed order on Wednesday, after a day of ups and downs, as investors hesitated to show their appetite following a session in the red with bond yields peaking and the prospect of higher rates for longer.
The Dow Jones index lost 0.20%, or 68.61 points, to 33,550.27 points.
The broader S&P-500 gained 0.98 points, or 0.02%, to 4,274.51 points.
The Nasdaq Composite advanced 29.24 points (0.22%) to 13,092.85 points.
Furthermore, investors kept a close eye on the progress of budgetary discussions in the US Congress to avoid a partial shutdown of federal administrations from Sunday, which would be the fourth in ten years.
This is further cause for concern for investors as 10-year US Treasuries rose to a 16-year high following the US Federal Reserve (Fed) meeting, which suggested on Wednesday that interest rates would remain high for longer than expected.
However, as the S&P-500 – which fluctuated between +0.4 and -0.8% during the session – fell sharply compared to the same period last year, some are wondering if the market don’t go near a ‘floor’.
“At some point, people are going to buy stocks for the fourth quarter,” said Peter Tuz, president of Chase Investment Counsel, believing that Wall Street’s downward trend may be coming to an end.
“At some level, people are going to start thinking again that the fourth quarter could be good,” he added.
Data published today show that manufacturing orders in the United States increased in August, while business spending on equipment appears to be rebounding after the trough seen at the start of the quarter.
“The concern is that the economy is still doing well and we need to see some weakness for interest rates to peak, and so far that hasn’t happened,” commented Paul Nolte, strategist at Murphy & Sylvest Wealth Management.
Investors are awaiting the publication of consumption data on Friday to have additional information on the inflation situation, but also comments from Fed officials including its President Jerome Powell.
Among the major sectors of the S&P-500, utilities, sensitive to interest rates, experienced the biggest drop of the day (1.9%). Energy increased by 2.5%, driven by the rise in crude prices – which represents a threat to the decline in inflation.
On the value side, Costco Wholesale gained 1.9% after beating expectations on its quarterly turnover and profit.
( Jean Terzian)
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