Stocks fell Wednesday as investors digested a summary of the Federal Reserve’s July meeting, which hinted at potentially higher rates.
The Dow Jones Industrial Average dropped 180.65 points, or 0.52 per cent, to end at 34,765.74. The S&P 500 dipped 0.76 per cent, closing at 4,404.33. Meanwhile, the Nasdaq Composite declined 1.15 per cent, ending the day at 13,474.63.
It was the second consecutive losing session for the three major averages.
In the central bank’s July meeting minutes, officials said additional tightening may be necessary to bring down inflation.
The federal funds rate is currently in a range between 5.25 per cent to 5.5 per cent, the highest level in more than 22 years.
Intel fell more than 3 per cent to lead the Dow lower.
Meanwhile, the back end of the corporate earnings season rolled on. Target shares rose roughly 3 per cent even after the retailer cut its full-year outlook. Insurance company Progressive jumped nearly 9 per cent, also on the back of its earnings report.
Tesla lowered prices by nearly 7 per cent for current Model S and X car inventories in China, following earlier price reductions on Model Y vehicles, raising worries of a renewed price competition, amid a 31 per cent drop in sales of its China-made vehicles from June to July, attributed partly to production halts for the upcoming revamped Model 3 launch.
In commodity-related news, the upcoming regulated carbon market is set to impact approximately 5,000 companies with annual emissions exceeding 25,000 tons of CO2 equivalent, primarily affecting sectors such as steel, cement, chemicals, and aluminium manufacturing.
Energy Transfer plans to acquire Crestwood Equity Partners for $7.1bn in an all-equity deal, enhancing its extensive oil and gas pipeline network as new project development faces increasing challenges in the North American fuel infrastructure sector.
Overall, all US sectors closed lower overnight except for Utilities. Consumer Discretionary was the worst performer.
Futures
The SPI futures are pointing to a 0.3 per cent fall.
Currency
One Australian dollar at 7:20 AM was buying 64.23 US cents.
Commodities
Gold shed 0.36 per cent. Silver fell 0.51 per cent. Copper lost 0.27 per cent. Oil lost 1.99 per cent.
Figures around the globe
European markets closed mixed. London’s FTSE fell 0.44 per cent, Frankfurt added 0.14 per cent, and Paris closed 0.10 per cent lower.
Turning to Asian markets, Tokyo’s Nikkei fell 1.46 per cent, Hong Kong’s Hang Seng fell 1.36 per cent while China’s Shanghai Composite closed 0.82 per cent lower.
The Australian sharemarket closed 1.50 per cent lower at 7195.
Ex-dividends
CD Private Equity I (ASX:CD1) is paying 11 cents unfranked
CD Private Equity II (ASX:CD2) is paying 19.5 cents unfranked
Korvest (ASX:KOV) is paying 35 cents fully franked
QBE Insurance Group (ASX:QBE) is paying 14 cents 10 per cent franked
Scentre Group (ASX:SCG) is paying 8.25 cents unfranked
Sources: Bloomberg, FactSet, IRESS, TradingView, UBS, Bourse Data, Trading Economics, CoinMarketCap.
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