United States markets were mixed in early trading on Thursday as investors looked over more earnings reports from big companies and assessed the latest government economic data.
KEEPING SCORE The Dow Jones industrial average was up 0.58 percent and the Standard & Poor's 500-stock index was down 0.04 percent. The Nasdaq composite index dropped 0.11 percent.
The Dow was higher almost entirely because of a big gain in Visa. Late Wednesday, the payments processing company announced earnings that beat analysts' expectations. The company also announced a big share buyback program. Energy and industrial stocks fell the most in the S.&P. 500.
Investors were weighing a stronger-than-expected report on the United States gross domestic product, which increased at a 3.5 percent pace in the third quarter.
A MISS The auto parts maker BorgWarner dropped 4 percent after reporting results that missed analysts' expectations.
EUROPEAN MARKETS In Germany, the DAX fell 1.6 percent and in France, the CAC 40 lost 0.9 percent. The FTSE 100 was down 0.9 percent in Britain.
STIMULUS OVER The Fed confirmed the end of its $4 trillion bond-buying program, the effect of which has been to expand the money supply, noting that the United States economy no longer needs as much assistance. Markets have been through several episodes of jitters about the program's withdrawal because the low interest rates and ample liquidity it engendered have provided significant support to stocks even as experts debated whether it was helping the U.S. economy. But the focus now is on when the interest rates will rise from record low levels. The Fed reiterated that 'considerable time' was needed before short-term borrowing rates are raised from near zero. It also noted the improving job market in the world's biggest economy, signaling that an eventual interest rate hike is on the cards.
THE QUOTE 'While 'considerable time' was kept, the Fed also inserted an escape clause, citing that it might raise rates sooner than anticipated if progress is faster than expected, and vice-versa. Thus, markets began to bring back pricing of the first rate hike back to June, and the U.S. dollar also rallied across the board,' Mizuho Bank's Chang Wei Liang said in a research note.
ASIA'S DAY The Nikkei 225 rose 0.7 percent in Japan, while in Hong Kong, the Hang Seng closed down 0.5 percent. The Shanghai Composite Index added 0.8 percent in China. The Kospi closed down 0.1 percent in South Korea. In Australia, the S.&P./ASX 200 rose 0.5 percent.
CURRENCIES The dollar rose to 108.99 yen from 108.77 in late trading Thursday. The euro slipped to $1.2591 from $1.2639.
ENERGY Benchmark crude oil dropped 72 cents to $81.48 in electronic trading on the New York Mercantile Exchange. The contract rose 78 cents to settle at $82.20 on Wednesday.
Posted by Unknown on Thursday, October 30, 2014 - Rating: 4.5
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