Advertisement
Business

Stocks move lower in morning trading as investors await Fed’s interest-rate decision

James Denaro, Mario Picone
Specialists James Denaro, left, and Mario Picone work at a post on the floor of the New York Stock Exchange on March 12.
(Richard Drew / AP)

U.S. stocks edged lower in early trading on Wall Street on Wednesday ahead of the latest interest rate policy decision by the Federal Reserve.

Healthcare and technology companies led the market lower as investors favored safer holdings in the utilities and real estate sectors. Microsoft and Apple fell, dragging other technology stocks down with them.

Johnson & Johnson and UnitedHealth Group slid 1.1%, weighing down their peers in the healthcare industry.

The market closed on a soft note Tuesday, ending a weeklong rally. The market is still off to a roaring start to the year. The S&P 500 index is up 12.6% so far in 2019. That’s better than the full-year gains for the benchmark index in four of the past five years.

Advertisement

Investors are looking ahead to comments from the Federal Reserve after its latest two-day meeting. The central bank has signaled that it will be “patient” in raising interest rates as it weighs a dimmer economic picture globally.

Bond prices rose ahead of the Fed announcement. The yield on the 10-year Treasury fell to 2.59%.

Investors are also digesting another snippet of information on trade talks between the U.S. and China. White House officials are saying that top U.S. trade and economic officials will visit China late next week for another round of negotiations. Wall Street is hoping for a resolution to the damaging trade war between the world’s largest economies, which has made goods more costly for companies and consumers.

The Dow Jones industrial average fell 106.2 points, or 0.4%, to 25,777 as of 10 a.m. The S&P 500 fell 0.3% and the Nasdaq composite 0.1%.

Advertisement

FedEx plunged after the company told investors that weak economic growth and higher costs will continue to cut into profit and revenue.

The package delivery company’s third-quarter profit fell more than expected as it dealt with slower economic growth and weak global trade. Revenue also fell short of forecasts. Looking ahead, the company cut its full-year profit forecast for a second time.

General Mills blew away profit forecasts for the third quarter as higher prices on some of its products lifted revenue.

The maker of Cheerios, Lucky Charms and Pillsbury has been facing tougher competition as consumer tastes continue to shift to healthier food options. The company has been working to build a broader mix of healthier products, along with raising prices on certain brands.

The company now expects adjusted full-year earnings per share to be flat to up 1% from last year’s $3.11. Previously it forecast a decline of up to 3%.

Germany’s Dax fell 1.5% on bad news for several key companies. Automaker BMW projected lower profits for the year. Also, a U.S. jury found that Bayer’s Roundup weed killer contributed to a California man’s cancer. Other European indexes edged lower and Asian indexes were mixed.


Advertisement