US shares close lower
Tech stocks take a hit
President Trump reportedly under investigation for obstruction of justice
Manufacturing output slips in May
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US stocks closed Thursday lower as tech firms weighed and the market digested rate rise news.
The Dow Jones closed down 14 at 21,359; the S&P 500 finished at 2,432, while the Nasdaq was down 29 at 6,165.
There was also disappointing economic news as US factory output fell unexpectedly last month.
The Federal revealed manufacturing production has slipped 0.4% in May after analysts had expected a modest 0.1 % rise.
US crude fell 0.72% to $44.42 a barrel.
In Toronto, the TSX fell 9.71 at 15,160.
MID-SESSION
US shares were on the losing track at mid-session as global equities struggled, tech stocks tumbled again and the London FTSE 100 closed over 55 points down.
The Dow Jones is over 21 lower to 21,353, the Nasdaq lost even more, trailing over 38 points at 6,150.
The broader-based S&P500 lost over seven points to stand at 2,430.
The dollar gained ground as the market digested the interest rate rate rise yesterday and the tougher line seemingly adopted by the Fed, and the idea that the era of easy money is drawing to a close.
US crude moved towards a seven month low - down 0.64% at $44.44 a barrel.
In stocks, retailer Kroger Co (NYSE:KR) plunged almost 19% to $24/65 as it delivered a disappointing earnings report.
The supermarkets, convenience stores and jewelry stores operator lowered full-year guidance after reporting a slide in like-for-like (LFL) sales in the three months to May 20.
LFL sales were down 0.2% year-on-year in the first quarter of the company’s financial year, though total sales, excluding fuel, rose 2.9%, helped by the inclusion of recently acquired ModernHEALTH’s sales this time round.
Adjusted net earnings of US$546mln, or 58 cents per share, were well down on the previous year’s US$696mln, equivalent to 71 cents per share.
Elsewhere, toy maker Mattel (NYSE:MAT) dropped over 7% to $20.59 as it revealed it was cutting the quarterly dividend by more than half.
The group is looking to free up money to help prepare brands for the digital world and expand in emerging markets.
Swiss bank UBS said that "medium-term" targets from the company provided little clarity regarding the timeline of a recovery.
On the winning front, HTG Molecular Diagnostics Inc (NASDAQ: HTGM) gained ground after the firm announced it had entered into a statement of work with QIAGEN Manchester.
US Fed is the only developed central bank in the world whose last move was a hike (4x now). https://t.co/abmHKyY8El pic.twitter.com/9ONGbWwc6I
— Charlie Bilello (@charliebilello) June 15, 2017
London shares close lower
FTSE 100 closed down around 55 points at 7,419 as retail and resource stocks weighed and the mid-cap index suffered the worst one-day drop in year.
FTSE 250, seen as a better gauge of the UK economy and domestic issues, tanked 421 points, at 19,553 - a drop of 2.11%.
It comes as, in the UK, there was an unexpected hint of a rate rise in the UK after three of the eight strong Bank of England Monetary Policy Committee voted for an interest rate rise. In the US yesterday, the Fed di pull the lever to raise rates.
Laith Khalaf, analyst at London-based broker Hargreaves Lansdown noted that sterling had "jumped up" in response, and that the market was now pricing in a one in three chance of an interest rate rise by the end of the year, up from a one in twenty chance yesterday.
OPEN..
US stocks joined the global sell-off on Wednesday and were in the red as trading kicked off.
The Dow Jones is 66 lower at 21,308; the S&P 500 shed almost 14 to 2,424 and the Nasdaq tanked 64 to 6,130.
Tech stocks are getting hit after a bounce back earlier in the week. Apple (NASDAQ:AAPL) shares are down over 1% to $143.70. Google parent Alphabet (NASDAQ:GOOGL) down 2.46% and Amazon (NASDAQ:AMZN) shed 2.12% to $955.80.
It comes after the Fed raised interest rates by a quarter percentage point and were hawkish in tone.
US crude is also down 0.27% at $44.61 a barrel at the time of writing.
In Toronto, the TSX is down 38 at 15,132.
PREVIEW...
US stocks are poised to go into reverse on Friday after gains made yesterday, after the Central Bank raised the cost of borrowing yesterday and outlined a tougher view than expected on its stance on monetary policy.
The notion is that the era of easy money after the global recession nearly a decade ago may now be coming to a close.
The Fed has raised interest rates 3 times over the last 6 months. BUT here's how that looks since 1967 https://t.co/oQmzsuOJkc$TLT $TNX pic.twitter.com/ewqCzHroNh
— StockTwits (@StockTwits) June 14, 2017
The UK is currently on a different track however and today kept rates on hold - at 0.25% but the market got jittery after it emerged three members of the eight on the committee had voted for an interest rate rise. FTSE 100 is down over 83 points at the time of writing, with sterling rising.
Back to the USA an yesterday, the key Federal-funds rate was hiked a quarter percent to a range between 1% and 1.25% — the third increase in the USA in a year and a half.
The Central Bank also outlined a plan to shrink its massive $4.5 trillion balance sheet starting this year.
The Dow closed up 46 at 21,374 - a new record, but the S&P 500 was 2.43 down at 2,437. The Nasdaq lost 25 at 6,194.
In futures today, the Dow Jones is 80 points lower; the S&P 500 is 14.5 lower and the Nasdaq futures are over 57 points down.
On the US political front, Donald Trump and his links with Russia during the presidential campaign is an ongoing saga.
The latest twist is that he is now reportedly being investigated for potential obstruction of justice by the special counsel looking into Russia’s interference in the 2016 presidential election.
In company news, shares in supermarket operator Kroger Co (NYSE:KR) are down over 7% in pre-market to $28.13 a pop as the company is due to report earnings before the opening bell.
US crude at the time of writing is down 0.49% to stand at $44.51 a barrel.
On the data front, four economic releases are slated to hit at 8:30 am. They are weekly jobless claims, May import prices, New York’s June manufacturing activity and the Philadelphia area’s June business conditions.