Fed Hikes Rates for First Time in Three Years; Dow Leads Decline, Energy Stocks Slump
Market & SentimentThe Fed raised rates by 25 basis points and signaled more tightening ahead, pressuring US stocks: the Dow fell 1.15%, the S&P 500 fell 0.44%, the Russell 2000 fell 0.43%, while the Nasdaq 100 edged up 0.03%. Market breadth was cold, with 154 advancers versus 332 decliners; only 32% of stocks are above their 50-day moving average, and new lows hit a one-year high of 26 versus 5 new highs, showing selling pressure is concentrated in most individual stocks rather than the weighted indexes.
Sectors & StocksEnergy was the worst performer, down 3.07%, and financials fell 1.65% on rate-hike expectations and falling oil prices; information technology edged up 0.16%, relatively resilient. Among individual stocks, Lumentum rose 9.59%, GE Vernova rose 4.79%, Intel rose 4.03%, and Dell rose 3.64%; Occidental Petroleum fell 6.55%, ConocoPhillips fell 6.15%, Robinhood fell 5.46%, and IBM fell 4.38%, with energy and high-valuation financials clearly under pressure.
Rates, FX & CryptoAfter the rate hike, short-end Treasury yields rose, with the 2-year up 7bp to 4.74%, the 10-year up 1bp to 5.01%, and the 30-year down 1bp to 5.35%, leaving the 2s10s spread at 27bp. USD/CNY was 6.7071, with the yuan up 0.07%; Bitcoin rose 0.34% to $76,174 and Ethereum rose 1.04%, while the crypto regulatory bill stalled in the Senate.
Earnings & AnnouncementsNo major earnings were released today. FinDog view changes: Autodesk, Best Buy, BlackRock, Blackstone, and Boston Scientific upgraded from Neutral to Bullish; Boeing downgraded from Neutral to Bearish, and Ciena and Citizens Financial downgraded from Neutral to Bearish; AutoZone upgraded from Bearish to Neutral. On announcements, Generac signed a long-term supply agreement with Amazon and issued warrants, and Expand Energy completed its acquisition of Twin Eagle and issued $500 million in notes.
- Bank of England rate decision, whether it follows the Fed
- US jobless claims and other employment data
- Middle East situation and Strait of Hormuz shipping
- The Fed delivered its first rate hike in three years and signaled more tightening ahead; the three major US indexes closed lower, with rate-sensitive sectors under pressure.Reuters09-16 09:07 UTC
- Investors await the Fed decision, with the 10-year Treasury yield holding above 5% as high long-end rates weigh on valuations.CNBC09-16 08:58 UTC
- The supply-disruption-driven rally is seen as overdone, and with a US industry report showing rising inventories, Brent crude fell 0.6% to about $108.10.Bloomberg09-16 03:52 UTC
- Rising Fed rate-hike expectations, plus a US crypto regulatory bill failing to advance in the Senate, pressured Bitcoin again.Bloomberg09-16 05:04 UTC
- OpenAI is in preliminary talks with investors for a new funding round at a valuation that may exceed $1.2 trillion, with an IPO planned afterward.Bloomberg09-16 02:13 UTC
- Boeing and Korean Air finalized an order for 103 aircraft, providing order support for Boeing, though 737 Max production stability remains in focus.
- The US House passed a Russia sanctions bill pushed by Graham, now sent to Trump, raising geopolitical risk.Reuters09-16 10:04 UTC
- Costco and Uber Eats expanded their delivery partnership from 17 states to 47 states, which may boost convenience and member loyalty.
- Boeing's CEO said stabilizing 737 Max production will take longer than expected, leaving delivery pace uncertain.
- GE Vernova and Vineyard Wind reached a settlement of more than $300 million over payments, turbine issues, and exit threats, removing a major uncertainty.
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