US close: Markets mixed after Fed hike, slew of data

Wall Street ended Thursday’s session on a mixed note, following losses in the previous session after a somewhat hawkish update from the Federal Reserve.

The Dow Jones Industrial Average ended the day down 0.1% at 25,175.31, while the S&P 500 rose 0.25% to 2,782.49 and the Nasdaq 100 added 1.03% to 7,279.59.

Investors were still digesting a 25 basis point rate hike from the Fed earlier in the session, which was announced on Wednesday as expected.

The central bank also upgraded its forecasts for this year and the next, and said it expects to deliver another two rate hikes this year and another three next year.

Markets had been pricing in three moves on rates this year.

“Four rate hikes for 2018 does not necessarily suggest that the end of the great bull market is at hand, but it has been enough to knock equities back this morning,” said Chris Beauchamp, chief market analyst at IG.

“After years of stasis in central banks, the developments are coming positively thick and fast.

“Jerome Powell Fed is clearly happy with the situation, feeling confident enough to knock the pace up a notch, and later today we will see if the ECB are in the mood to make a few changes too.”

Also on investors minds was news that the European Central Bank had decided to end its asset purchase programme at the end of 2018, while also confirming that interest rates would remain at their current levels, at least until September 2019.

The ECB's decision to wind-up the programme had been widely anticipated, following a recent speech by its chief economist, but the forward guidance on the first rate hike was more dovish than most economists had forecast.

On the data front, retail sales figures for May revealed that US consumers took to the malls with sharp increases seen in outlays on building materials, gasoline and clothing.

Even department store sales increased, said Mickey Levy at Berenberg Capital Markets, who also flagged up somewhat "upside" risks to his forecast for second quarter US GDP.

Total retail sales volumes jumped by 0.8% month-on-month in April to reach $501,971bn, according to the Department of Commerce, and the so-called 'control group' of US retail sales - which excludes those of automobiles and gasoline - also outpaced forecasts, growing by 0.8% versus March, and against consensus forecasts for 0.3%.

Following Thursday's data, Barclays' tracking estimate for second quarter US GDP rose from 3.0% to 3.5%.

Import prices, released alongside retail sales, jumped last month, pushed higher by a sharp increase in the bill for fuel imports.

Total US import prices rose by 0.6% month-on-month in May, beating the 0.5% month-on-month increase forecast by economists, according to the Bureau of Labor Statistics.

Compared to a year ago, import prices rose 4.3%.

Initial jobless claims, meanwhile, unexpectedly fell last week and the number of Americans on jobless rolls declined to a near 44-year low, indicating a rapidly tightening labor market.

According to the Labor Department, claims for state unemployment benefits dropped 4,000 to a seasonally adjusted 218,000.

Economists had forecast claims rising to 224,000.

Lastly, US business inventories rebounded in April, although a slight downward revision to retail stocks implied that the contribution of inventory investment to economic growth across the second-quarter could be limited.

The Commerce Department said that business inventories rose 0.3% after slipping 0.1% in March.

In corporate news, 21st Century Fox picked up 2.11% at the open after Comcast made a $65bn bid for its entertainment and international assets.

Tailored Brands tumbled 21.77% after its first-quarter results late on Wednesday fell short of expectations.

Dow Jones - Risers

Walt Disney Co. (DIS) $108.75 2.30%
Cisco Systems Inc. (CSCO) $44.69 1.55%
Intel Corp. (INTC) $55.54 0.93%
Verizon Communications Inc. (VZ) $47.84 0.89%
Nike Inc. (NKE) $74.70 0.77%
Unitedhealth Group Inc. (UNH) $255.33 0.69%
Microsoft Corp. (MSFT) $101.42 0.57%
Exxon Mobil Corp. (XOM) $81.96 0.47%
McDonald's Corp. (MCD) $167.05 0.19%
Visa Inc. (V) $135.00 0.10%

Dow Jones - Fallers

Caterpillar Inc. (CAT) $153.14 -2.76%
JP Morgan Chase & Co. (JPM) $108.03 -1.96%
Coca-Cola Co. (KO) $43.58 -1.87%
General Electric Co. (GE) $13.64 -1.80%
Merck & Co. Inc. (MRK) $61.56 -1.66%
Procter & Gamble Co. (PG) $75.99 -1.62%
American Express Co. (AXP) $99.76 -0.96%
International Business Machines Corp. (IBM) $145.22 -0.77%
United Technologies Corp. (UTX) $126.94 -0.71%
3M Co. (MMM) $203.63 -0.61%

S&P 500 - Risers

Spectra Energy Corp. (SE) $15.96 6.83%
Amerisource Bergen Corp. (ABC) $93.35 6.03%
CBS Corp. (CBS) $55.12 5.23%
Royal Caribbean Cr (RCL) $113.50 5.10%
Comcast Corp. (CMCSA) $33.82 4.64%
Discovery Inc. Class A (DISCA) $25.50 4.47%
Discovery Inc. Class C (DISCK) $24.15 4.36%
Anthem Inc (ANTM) $241.74 4.34%
CVS Health Corp (CVS) $69.12 4.17%
Aetna Inc. (AET) $188.09 4.10%

S&P 500 - Fallers

GameStop Corp. (GME) $12.85 -8.54%
PulteGroup Inc. (PHM) $30.80 -6.61%
Kohls Corp. (KSS) $73.28 -6.44%
Macy's Inc. (M) $37.56 -6.03%
Nordstrom Inc. (JWN) $49.87 -5.78%
AT&T Inc. (T) $32.52 -5.33%
Oracle Corp. (ORCL) $45.90 -5.26%
Mylan Inc. (MYL) $39.51 -5.18%
Gap Inc. (GPS) $31.33 -4.86%
Waters Corp. (WAT) $200.15 -4.54%

Nasdaq 100 - Risers

JD.com, Inc. (JD) $43.75 6.06%
Mercadolibre Inc. (MELI) $305.00 4.81%
Comcast Corp. (CMCSA) $33.82 4.64%
Incyte Corp. (INCY) $73.64 4.39%
Hologic Inc. (HOLX) $40.23 3.85%
Tesla Inc (TSLA) $357.72 3.75%
Seagate Technology Plc (STX) $59.08 3.74%
Charter Communications Inc. (CHTR) $295.61 3.72%
Dish Network Corp. (DISH) $34.08 3.71%
Netflix Inc. (NFLX) $392.87 3.41%

Nasdaq 100 - Fallers

Mylan Inc. (MYL) $39.51 -5.18%
Applied Materials Inc. (AMAT) $49.69 -2.53%
Lam Research Corp. (LRCX) $181.17 -1.85%
Micron Technology Inc. (MU) $59.18 -1.45%
eBay Inc. (EBAY) $39.00 -0.84%
Fastenal Co. (FAST) $52.79 -0.43%
Biogen Inc (BIIB) $305.68 -0.40%
PACCAR Inc. (PCAR) $63.76 -0.39%
Cintas Corp. (CTAS) $191.56 -0.38%
Western Digital Corp. (WDC) $82.55 -0.37%