4:10pm: Industrials end in the red after mostly positive day
The Dow ended Wednesday down 121 points, 0.4%, at 31,270 after spending most of the session in the green. The Nasdaq lost 361 points, 2.7%, to 12,998, and the S&P 500 dropped 51 points, 1.3%, to finish at 3,820.
Tech was the lagging sector, as Amazon.com Inc (NASDAQ:AMZN), Microsoft Corporation (NASDAQ:MSFT), Alphabet Inc (NASDAQ:GOOG) and Netflix Inc (NASDAQ:NFLX) all lost more than 2%, with the popular streaming service swooning nearly 5% to $520.70.
The tech losses came alongside gains by the 10-year Treasury yield. The benchmark rate rose as high as 1.49% Wednesday. Last week the rate hit 1.6%.
12:45pm: Dow outperforms the broader market
The Dow was up 54 points, 0.2%, to 31,446 at midday. Meanwhile, the Nasdaq dropped 192 points, 1.4%, to 13,168, and the S&P 500 slipped 18 points, 0.5%, to 3,852.
“Like with last week, the rise in government bond yields is encouraging dealers to cut their exposure to stocks,” CMC Markets UK analyst David Madden wrote Wednesday. “The nudge higher in the US 10-year is weighing on equities, tech stocks continue to underperform. The ISM non-manufacturing update for February was 55.3, while economists were predicting it to hold steady at 58.7.”
Lyft Inc stock jumped more than 9% to $62.23 after the company reported a rise in ridesharing and confirmed that the last week of February was its busiest since the pandemic began, Madden wrote.
10:25am: Proactive North America headlines:
District Metals Corp (CVE:DMX) (OTCMKTS:MKVNF) (FRA:DFPP) identifies another target at its Swedish project after receiving historic drill assays
ImagineAR Inc (CSE:IP) (OTCQB:IPNFF) (FRA:GMS1) wins US patent for location-based virtual multiplayer gameplay technology
Ascendant Resources Inc (TSE:ASND) (OTCMKTS:ASDRF) increases indicated resources by 79% at Lagoa Salgada project after Phase 1 drilling
Mirasol Resources Ltd (CVE:MRZ) (OTCPINK:MRZLF) (FRA:M8R) kicks off maiden 1,500m drill program at Inca gold project in Chile
OTC Markets Group Inc (OTCQX:OTCM) unveils schedule for virtual Community Bank conference on March 10-11
10:15am: Mixed start on Wall Street
US markets made a mixed start on Wall Street after worse than expected employment data from ADP.
The Dow Jones Industrial Average is up around six points at 31,398. But the more broadly based S&P 500 lost around 24 points at 3,846. The tech-heavy Nasdaq Composite has fallen around 166 points at 13,192.
The latest ISM service sector survey came in at 55.3 for last month (February) compared to the 58.7 that was expected, showing a pull-back in the rate of growth in the sector.
Later at around 7pm UK time comes the latest snapshot of the US economy from the Federal Reserve, the so-called Beige Book which is published eight times a year.
Michael Hewson, chief market analyst at CMC Markets UK, said: “[This] could well paint a more optimistic picture of the US economy than was the case in the previous survey, at the end of last year. The overall picture is also likely to see a rebound in retail sales spending if the recent retail sales data is any sort of guide, however we could also see signs of a rise in inflationary pressure if the latest prices paid data is any guide.
“With new stimulus measures also on their way, the latest Beige Book is likely to see a much more optimistic outlook than the one in January, especially given that vaccinations are now much more advanced than they were back at the beginning of the year.”
6:50am: US stocks seen rising
US stocks are expected to rise on Wednesday, rallying again amid fresh optimism for an economic rebound as the roll-out of coronavirus (COVID-19) vaccines steps-up and there is progress toward a deal on President Biden’s new stimulus package.
Futures for the blue-chip Dow Jones Industrial Average and the broader S&P 500 index were both 0.7% higher, while the tech-laden Nasdaq-100 index futures added 0.8%, all recovering after a weaker session on Tuesday.
Wall Street has been volatile in recent days but on Wednesday, sentiment was buoyed by signals that the Democrats will seek to bridge differences over jobless benefits and other issues as they aim to complete the $1.9 trillion relief package in coming days.
And there was also a boost after President Biden said the US would have enough COVID-19 vaccines for all American adults by the end of May, two months earlier than had previously been expected.
The bond market has also calmed in recent days after a surge in yields rattled investors last week, leading to sharp declines in stocks. Top central bank officials have said the rise in yields reflected optimism about economic prospects.
Federal Reserve governor Lael Brainard said Tuesday that the recent tumult in the bond market is on her radar screen. However, she signalled that the Fed will not be dialling back on support for the economy until it is on a stronger footing, reiterating comments made by other officials.
Investors will eye data from the Institute for Supply Management on the US services sector, due at 10.00am ET. The figures are expected to show sector activity expanded for a ninth consecutive month in February. And the Fed’s beige book report, due at 2.00pm ET, will also offer the latest anecdotal evidence on the state of US businesses as they gear up for a reopening of the economy.
On commodity markets, Brent Crude Oil rose 1.5% to $63.63 a barrel, while gold prices fell 0.4%.
Five things to watch on Wednesday:
- Rocket, parent of Quicken Loans rose again pre-market on Wednesday with its shares having doubled this week as it gained popularity on internet message boards as a short-squeeze candidate
- SpaceX is building a new factory in Texas for its satellite-based broadband service Starlink, according to a job posting from the company, as billionaire entrepreneur Elon Musk continues to invest in the southern state
- Samsung Electronics is considering two sites in Arizona and another one in New York in addition to Austin, Texas, for a new $17 billion chip plant, according to documents filed with Texas state officials a Reuters report said
- Exxon Mobil Corp has said it plans to cut its workforce in Singapore, home to its largest oil refining and petrochemical complex, by about 7% amid the “unprecedented market conditions” resulting from the COVID-19 pandemic
- Nordstrom Inc warned after the close on Tuesday that it would have to go through its off-price channel to clear some of its holiday merchandise inventory in the first quarter that piled up due to shipping delays
Story by ProactiveInvestors
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