YAHOO [BRIEFING.COM]: Four straight sessions of gains resulted in a
cumulative gain greater than 3%, but that streak was snapped today as
participants responded to a flurry of headlines from the Fed.
Headlining the news flow today is the latest FOMC Directive, which
aims to extend "Operation Twist" through the end of the year in an
effort to extend the average maturity of the Fed's securities holdings. Fed
Chairman Bernanke later stated in a press conference that additional asset
purchases would be considered by the Fed if necessary.
Stocks encountered selling in the minutes leading up to the
announcement and even immediately after its release, but then began to rebound
before losing momentum narrowly above the neutral line.
A lackluster forecast from the Fed failed to further encourage
buyers. The Fed now expects real GDP growth for 2012 to range from 1.9% to
2.4%, down from the range of 2.4% to 2.9% that was previously projected.
Unemployment for 2012 is now expected to range from 8.0% to 8.2%, which is up
from the previously forecasted range of 7.8% to 8.0%. Inflation pertaining to
total personal consumption expenditures is now expected to the range from 1.2%
to 1.7%, while the core rate is now expected to range from 1.7% to 2.0%.
The dollar attracted a modest bid after spending most of the
morning near the flat line, but was up only 0.1% against a basket of major
foreign currencies by the closing bell.
Most commodities were clipped for losses, such that the CRB Index
suffered a 1.6% loss after it had climbed more than 1% in the prior session.
Among its more closely tracked constituents, crude oil touched a new 2012 low
of $81.28 per barrel for the August contract before settling with a 3.4% loss
at $81.45 per barrel. Weaker-than-expected inventory data likely exacerbated
selling. As for gold, the yellow metal set a session low of $1590.50 per ounce
before it settled floor trade with a 0.4% loss at $1616.60 per ounce.
Treasuries traded lower, but not terribly so. Action settled with
the yield on the benchmark 10-year Note near 1.65%. As an aside, yields on
Corporate news was in closer focus in the early going, but by
afternoon it was overshadowed by the Fed.
Dow component Procter &
Gamble (PG 60.39, -1.82) displeased market participants by
cutting its profit forecast, but fellow blue chip JPMorgan Chase (JPM 36.45, +1.07)
attracted buying interest when it was learned that the company has exited some 65-70%
of its losing position.
Discover Financial (DFS
34.14, +0.57) served up in-line earnings and guidance that helped earn it favorable reviews from a few analysts. An
underwhelming outlook from Adobe (ADBE
31.99, -0.90) overshadowed the company’s upside earnings surprise, but the
stock still managed to slash its loss.
General weakness in the commodity complex dropped the CRB Index for
a 1.6% loss. That fully erased the gain that it had scored in the prior
session.
Crude oil spent its entire pit session in the red, trending lower
after touching a session high of $84.09 per barrel moments after floor trade
opened. Weaker-than-expected inventory data that showed a build of 2.8 million
barrels when a draw of 1.3 million barrels had been expected exacerbated
selling. It touched a new 2012 low of $81.28 per barrel for the August contract
before settling with a 3.4% loss at $81.45 per barrel. Natural gas gave up a
strong overnight gain to slide into negative territory just a half hour into
its floor session. It ultimately settled a choppy session with a 1.2% loss at
$2.52 per MMBtu.
Gold trended lower in negative territory during morning pit action.
It set a session low of $1590.50 per ounce following the release of the FOMC
Directive that announced the extension of "Operation Twist." However,
it rallied to a session high of $1620.30 per ounce before it settled floor
trade with a 0.4% loss at $1616.60 per ounce. Silver began pit trade in
negative territory, but pushed into positive territory to set a session high of
$28.50 per ounce before it retreated all the way back to $27.63 per ounce.
Silver eventually rebounded again so that it settled with a 0.1% gain at $28.39
per ounce.
Advancing Sectors:
Tech +0.2%, Financials +0.2%
Declining Sectors:
Consumer Discretionary -0.1%, Helath Care -0.2%,
Energy -0.3%, Industrials -0.4%, Telecom -0.5%, Consumer Staples -0.5%,
Materials -0.5%, Utilities -1.1%DJ30 -12.94 NASDAQ +0.69 NQ100 +0.1% R2K -0.4%
SP400 -0.2% SP500 -2.29 NASDAQ Adv/Vol/Dec 1052/1.44
bln/1403 NYSE Adv/Vol/Dec 1392/614 mln/1599