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Traders who work on the New York Stock Exchange.
New York Stock Exchange
The stock market was rising on Wednesday after the Federal Reserve released the minutes of its May meeting. Markets are analyzing the minutes for clues about the central bank’s plans to raise interest rates.
In the afternoon trading,
He got 57 points or 0.5%, while
rose 0.3% and
He got 1%.
This is a partial reflection of ongoing sales Tuesdaywho came on the back ominous warning from
Explode, Explode
(Stock ticker: SNAP) That the company will lose its sales and earnings guidance. The company blamed a weak economic outlook, which will be consistent with a Reduction in advertising spendIt is one of the easiest costs companies can cut if they are concerned about an economic slowdown.
These fears of a slowdown were already caused by the Federal Reserve, which was adamant about continuing to raise interest rates to cut them. high inflation. But the question now is whether the central bank will slow down the pace of interest rate hikes or stick to the current rate hike path. The minutes of the Fed meeting should provide clues.
If the markets interpret the minutes as less optimistic, it could support the continuation of the latest attempt at the recovery rush while any hawkish interpretations could lead to a return of volatility as the news flow has been emphatically negative over the past week. Tom Assaii Reports Sevens.
Already, there are some signs that higher interest rates are starting to slow the economy. New home sales, for example, are down Middle-aged in terms of percentage on a monthly basis as mortgage rates rose. “It is evidence that higher mortgage rates from the Fed are starting to flow with the desired effect in terms of calming the housing market,” wrote Ian Lyngen of BMO Capital Market.
Spending on Citi credit cards has also declined, year-over-year, in the past few weeks, according to bank data.
Data released on Wednesday revealed that durable goods orders rose 0.4% in April from the previous month, missing estimates for a 0.6% rise. The increase in orders compared to the same period last year has seen a decrease in recent months.
Overall, “how much financial conditions need to tighten to slow growth is still unclear, but conditions have tightened significantly over the past few quarters, and this process will lead to slower growth + lower [companies’] Pricing power,” writes Denis Debuschere, founder of 22V Research.
Here are some stocks on the go on Wednesday:
Dick sporting goods
(DKS) stock fell initially before rising 9.1% after the company 2022 EPS Steering Parts By about 15% and cut its same-store sales estimates to a 5% year-over-year decline. Management cited “evolving macroeconomic conditions,” as expectations for consumer spending dwindle.
“The significant reduction in the 2022 guidance is disappointing and supports the view that consumers are spending less on sporting goods and promotions are likely to return to a more normal level,” wrote Joe Feldman, analyst at Telsey Advisory Group.
The stock had already lost about a third of its value in the year prior to earnings.
Wendy
(WEN) (WEN) stock rose 10% after Trian Fund Management, led by billionaire Nelson Peltz, said in a statement that it had spoken with the fast-food chain’s board of directors about an “acquisition, business combination (such as a merger, consolidation, and tender” offer or transaction). similar) or other transaction.”
gut instinct
(INTU) is up 8% after the tax and accounting software company’s announcement Better-than-expected earnings for the third quarter of the fiscal year He raised his financial forecast for the year ending in July.
Nordstrom
(JWN) rose 11% after Lifting Reseller Directed For the second time this year.
Toll Brothers
(TOL) rose 6.2% after the homebuilder reported better-than-expected earnings and sales in the second quarter.
nvidia
(NVDA) shares rose 3.1%, ahead of the chipmaker’s public finances first quarter earnings scheduled after closing bell Wednesday.
Write to Jacob Sonenshine at jacob.sonenshine@barrons.com and Joe Woelfel at joseph.woelfel@barrons.com
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