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Dow falls more than 100 points after Fed decision to hike interest rate

The Federal Reserve made the decision to hike interest rates by 25 basis points
Federal Reserve
The Fed sees two more increases likely in the future

The U.S. benchmarks ended the day in the red following the Federal Reserve’s widely-expected decision to hike interest rates by 25 basis points. There are two additional increases likely on the horizon.

While the decision wasn’t a shock to investors, the markets still took a hit.

The Dow Jones Industrial Average fell 115 points, weighed down by bellwether Caterpillar Inc.(NYSE:CAT) and Verizon Communications (NYSE:VZ).

The tech-heavy Nasdaq was down around 8 points after hitting a new intraday high, boosted by media stocks including Twenty-First Century Fox Inc (NASDAQ:FOX).

The S&P 500 was down more than 10 points. H&R Block Inc (NYSE:HRB) was a top decliner, falling nearly 18% after sharing a bleak revenue outlook.  

Up north, the TSX was down by 15 points as energy stocks offset gains in healthcare and financial stocks.

The Russell 2000 small-cap index saw a slight decline, dragged down by scPharmaceuticals Inc (NASDAQ:SCPH) and vTv Therapeutics Inc (NASDAQ:VTVT).

12 PM: US stocks march cautiously higher as interest rate hike decision looms

US stocks held onto their gains for the most part to march cautiously higher in afternoon trade as a Federal judge’s decision to give the go-ahead to the AT&T-Time Warner merger resulted in media company shares swinging higher.

Also weighing on markets was the wait for a 2 p.m. decision from the Federal Reserve, which is expected to raise interest rates by a quarter of a percentage point.

After turning negative for a brief spell, the Big Board stayed flat at 25,321, its performance impeded by laggards such as Verizon Communications and Caterpillar Inc.

Still trading at record highs, the tech-heavy Nasdaq performed best, meanwhile, adding 33 points to hover at 7,736, led higher by Twenty-First Century Fox, Netflix Inc and Express Scripts Holdings.

The approval of AT&T-Time Warner's mega merger pushed up shares of companies involved in takeovers.

Twenty-First Century Fox traded 7.5% higher as it appears likely to be on the receiving end of a rival US$60bn all-cash bid  by Comcast for much of its assets.

Express Scripts was also up almost 4% as its acquisition by Cigna looks more likely in the wake of AT&T-Time Warner's tie-up.

Elsewhere, the S&P 500 was little changed, adding 1.2 points to 2,788 while the Russell 2000 fell slightly, losing 2 points to 1,680.

10 AM: US stocks rise modestly as markets brace for Fed decision


US stock rose modestly Wednesday as the countdown began for investors to a decision from the Federal Reserve, which is widely expected to increase rates by a quarter of a percentage point after it wraps up its June meeting.

Investors will parse the Fed statement to be issued 2 p.m., along with its latest economic forecasts and interest rate outlook. It could stir up markets if the Fed’s economic and inflation forecasts sound more hawkish. Investors are trying to get a clearer outline for how many rate hikes may be in the offing in coming months and years.

The Dow Jones Industrial Average was up 17.61 points, or 0.10% to 25,344.89.

The tech-laden Nasdaq was trading at a record high, adding 15 points, or 0.18% to hover at 7,718 turbocharged by Twenty-First Century Fox which rallied 7% Wednesday after a judge ruled Tuesday that the US$85bn AT&T and Time Warner deal could go through raising valuations for the media industry.

The S&P 500, meanwhile, was up 1.30 points, or 0.05% to 2,788.37, while the Russell 2000 index of small-cap stocks was up 0.05% to 1,683.21.

Shares of AT&T Inc. (NYSE:T) lost over 4% Wednesday, while Time Warner Inc. (NASDAQ:TWX) jumped 3.65%. Meanwhile, shares of Comcast were down down 0.73% as investors expect it to now make its bid for the 21st Century Fox film and TV studio assets Walt Disney Co. has already agreed to buy. 

 


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