US close: Markets reverse earlier gains to finish in the red
Trading on Wall Street finished in the red on Wednesday, having bounced higher earlier in the session after a sell-off on Tuesday was fuelled by new Fed chair Jerome Powell's congressional testimony on, which rattled the market.
The Dow Jones Industrial Average finished 1.5% behind at 25,029.20, the S&P 500 was off 1.11% at 2,713.83, and the Nasdaq 100 fell 0.67% to 6,854.42.
On Tuesday, stocks ended in the red as Powell’s first congressional testimony did little to soothe investors’ worries about inflation.
A hawkish tone signalled that US interest rates were set to continue rising, adding weight to expectations of four rate hikes this year - rather than three.
Powell said that his "personal outlook for the economy had strengthened since December", with data that "will in my case add some confidence to my view that inflation is moving up to target."
Among the reasons for his optimism, he cited the continuing strength in the labour market, a fiscal impulse, and the global economic expansion.
“This was a clear shot across the bow from the new Chair, suggesting that - if it is up to him - the FOMC may want to revise its current projections of three hikes for this year up to include a fourth,” noted analysts at Rabobank.
Powell was due to make his next appearance on Capitol Hill in front of a Senate committee on Thursday.
On the data front, fourth-quarter GDP was, as expected, revised down by the Commerce Department to reveal a rate of expansion of 2.5%, less than a prior reading of 2.6%, keeping it on track for a slow start to the year.
The downward revision reflected a greater subtraction from private inventory investment.
Output grew 2.5% in the fourth quarter of 2017 when compared with same period a year earlier, which was far faster than the 1.8% pace of expansion seen in 2016, something Spreadex market analyst Connor Campbell said "might take the shine off the dollar and give the Dow a bit more room to breathe."
Separately, economic activity in the Chicago area deteriorated more quickly than expected in February, according to the Chicago PMI published by MNI.
The MNI Chicago Business Barometer fell to 61.9 in February from 65.7 in January, its lowest level since August 2017, missing expectations of a smaller decline to 64.1.
As in January, firms reported a slower pace of incoming orders and output, as new orders dropped to a six-month low, the principal reason for the barometer's decline, while the production indicator also slipped, to a level last seen lower in September.
Elsewhere, the National Association of Realtors said that contracts to buy previously owned homes had unexpectedly declined in January to their lowest level in more than three years, another indication that the housing market was losing some of its steam.
NAR's pending home sales index dropped to a reading of 104.6, down 4.7% from December, which was also downwardly revised to 109.8, missing forecasts for a 0.3% increase by a mile.
In corporate news, Office Depot fell 9.31% after its fourth-quarter profit beat expectations but sales fell short, while Lowe’s Companies dropped 6.76% after its quarterly profits missed expectations.
Etsy surged 20.35% after the online marketplace issued forecast-beating fourth quarter earnings, while Booking Holdings was 6.77% higher after better-than-expected quarterly earnings and sales late on Tuesday.
Dow Jones - Risers
Apple Inc. (AAPL) $178.12 -0.15%
Boeing Co. (BA) $362.21 -0.35%
Microsoft Corp. (MSFT) $93.77 -0.46%
Cisco Systems Inc. (CSCO) $44.78 -0.58%
United Technologies Corp. (UTX) $134.68 -0.58%
Intel Corp. (INTC) $49.29 -1.24%
Visa Inc. (V) $122.94 -1.32%
Johnson & Johnson (JNJ) $129.88 -1.66%
International Business Machines Corp. (IBM) $155.81 -1.75%
Coca-Cola Co. (KO) $43.22 -1.84%
Dow Jones - Fallers
Walt Disney Co. (DIS) $103.14 -6.07%
Caterpillar Inc. (CAT) $154.63 -5.53%
Dowdupont Inc. (DWDP) $70.26 -5.13%
American Express Co. (AXP) $97.43 -4.14%
Exxon Mobil Corp. (XOM) $75.74 -3.93%
Procter & Gamble Co. (PG) $78.52 -3.81%
Nike Inc. (NKE) $67.03 -3.76%
General Electric Co. (GE) $14.11 -3.69%
McDonald's Corp. (MCD) $157.74 -3.57%
3M Co. (MMM) $235.51 -3.53%
S&P 500 - Risers
Tenet Healthcare Corp. (THC) $20.60 8.02%
Macy's Inc. (M) $29.41 7.14%
Booking Holdings Inc. (BKNG) $2,034.04 6.74%
TJX Companies Inc. (TJX) $82.68 4.86%
AES Corp. (AES) $10.88 4.11%
Mallinckrodt Plc Ordinary Shares (MNK) $16.68 3.03%
O'Reilly Automotive Inc. (ORLY) $244.19 2.35%
Marriott International - Class A (MAR) $141.21 2.24%
Chipotle Mexican Grill Inc. (CMG) $318.41 2.09%
L Brands Inc (LB) $49.33 1.61%
S&P 500 - Fallers
Frontier Communications Co. (FTR) $7.03 -23.92%
Chesapeake Energy Corp. (CHK) $2.82 -12.31%
Spectra Energy Corp. (SE) $10.96 -9.79%
AutoZone Inc. (AZO) $664.13 -9.67%
Celgene Corp. (CELG) $87.12 -9.04%
Lowe's Companies Inc. (LOW) $89.59 -8.12%
Perrigo Company plc (PRGO) $81.46 -7.75%
TEGNA Inc (TGNA) $12.86 -7.68%
Newell Brands Inc (NWL) $25.69 -7.66%
Endo International Plc (ENDP) $6.30 -7.42%
Nasdaq 100 - Risers
Booking Holdings Inc. (BKNG) $2,034.04 6.74%
Mercadolibre Inc. (MELI) $387.97 3.34%
O'Reilly Automotive Inc. (ORLY) $244.19 2.35%
Marriott International - Class A (MAR) $141.21 2.24%
Liberty Interactive Corporation QVC Group (QVCA) $28.87 2.01%
Expedia Inc. (EXPE) $105.17 1.41%
Autodesk Inc. (ADSK) $117.47 1.16%
T-Mobile Us, Inc. (TMUS) $60.61 1.12%
Seagate Technology Plc (STX) $53.40 1.00%
Starbucks Corp. (SBUX) $57.10 0.94%
Nasdaq 100 - Fallers
Celgene Corp. (CELG) $87.12 -9.04%
Dish Network Corp. (DISH) $41.69 -4.47%
Express Scripts Holding Co (ESRX) $75.45 -4.06%
Liberty Global plc Series C (LBTYK) $30.03 -3.44%
Liberty Global plc Series A (LBTYA) $31.14 -3.23%
Charter Communications Inc. (CHTR) $341.93 -2.65%
CSX Corp. (CSX) $53.72 -2.54%
Analog Devices Inc. (ADI) $90.15 -2.29%
Tesla Inc (TSLA) $343.06 -2.26%
Biomarin Pharmaceutical Inc. (BMRN) $81.17 -2.22%