US stocks close sharply lower
TSX down 46 pts
Jerome Powell strikes hawkish tone; worries market
US stocks closed sharply lower, with the Dow Jones down almost 300 points at 25,410.
The broader-based S&P 500 shed over 35 points at 2,744, while the tech heavy Nasdaq shed over 91 points at 7,330.
It came as the dollar firmed and equities weakened as new Fed chair Powell heightened angst over interest rate rises amid a strengthening US economy.
US crude (West Texas Intermediate) shed 1.6% to US$62.88 a barrel.
Earlier in London, FTSE 100 shed around seven points at 7,282.
In Toronto, the TSX lost over 46 points at 15,668.
MID-SESSION
US markets were down in the dumps still at mid-session after new chair of the Federal Reserve Jerome Powell appeared before Congress and struck a more hawkish tone on the central bank's position.
The Dow Jones shed over 20 points at 25,688, while the S&P 500 is down 8.48 at 2,771.
The techy heavy Nasdaq shed over 34 points at 7,387.
"Following his appearance US treasury yields jumped higher to 2.9 as concerns over more aggressive hiking from the Fed took hold," said Fiona Cincotta, senior market analyst at City Index.
"The jump in treasury yields supported a rally in the dollar, which broke through 89.86 to 90.50 meanwhile, consistent with previous sessions, the high yields weighed on the US equity indices which sold off."
In Toronto, the TSX shed over 25 points at 15,688.
Among notable losers, Akorn Inc (NASDAQ:AKRX) shed nearly 34% to US$19.99after Fresenius Kabi AG announced an independent investigation into alleged breaches of FDA data integrity requirements related to product development. Akorn has released a statement confirming its active participation in the probe.
On the rising front, Mallinckrodt PLC (NYSE: MNK) added over 21% to US$19.62 after the firm reported upbeat results for its fourth quarter.
OPEN
US stocks started in positive territory but gains dwindled and the Dow Jones is down six points at 25,702.
The S&P 500 is also lower at 2,779, down 0.07.
The tech heavy Nasdaq index is down 5.5 at 7,415.
In stocks, a notable gainer was department store Macy's (NYSE:M), which saw shares add around 7% at US$29.37 as earnings and same-store sales for the holiday topped analysts' expectations, fueling hopes the firm's turnaround plans are kicking in.
Macy's crushes earnings expectations for its crucial holiday quarter https://t.co/nalWxSo52G pic.twitter.com/DM8I1dPDYr
— Business Insider (@businessinsider) 27 February 2018
PREVIEW
The Dow Jones average, which yesterday soared 399 points to 25,709, was expected to open at around 25,739; the S&P 500, which rose 32 points yesterday to close at 2,779.6, was expected to open at around 2,780.5.
“There is a huge sense of anticipation across financial markets today, as investors brace for Federal Reserve chairman Jerome Powell’s first congressional testimony later in the day,” declared Lukman Otunuga at FXTM.
“Powell’s début appearance is a big deal and could offer investors a rare opportunity to carefully assess the Federal Reserve’s monetary policy approach under the new chair. Markets will scrutinise Powell’s every word, especially his views on inflation and where he sees interest rates this year. Expectations are that he will express optimism over the economic outlook,” Otunuga continued.