Stocks - S&P Closes Flat as Fed Minutes, Energy Weigh
Investing.com - The S&P 500 closed flat on Wednesday as the Federal Reserve's minutes pointed to further monetary tightening, while a slump in oil prices pressured energy stocks.
The Dow Jones Industrial Average fell about 0.36%. The S&P 500 fell 0.03%, while the Nasdaq Composite fell 0.04%.
Wall Street's attempt to extend its rally following its biggest one-day gain since March on Tuesday was undone by concerns that further Fed rate hikes could fuel a rally in U.S. government bond yields, denting investor appetite for risker assets like stocks.
The Federal Reserve's minutes showed that members remained committed to gradually raising interest rates as the economy was on pace to churn out "strong" growth in the third quarter of the year.
U.S. government bond yields surged following the release of the Fed's minutes as the 10-year Treasury note yield hit session highs.
Mostly upbeat corporate earnings, which have helped shift investor focus away from rising bond yields to corporate fundamentals, helped offset losses somewhat in the broader averages.
Netflix (NASDAQ:NFLX) posted third-quarter earnings postmarket Tuesday that handily beat expectations, as subscriber numbers came in well above analysts' estimates amid strong growth in both U.S. and overseas markets. Its stock closed 5.3% higher.
M&T Bank (NYSE:MTB) and US Bancorp (NYSE:USB) results also topped estimates, adding to a recent wave of bullish earnings from banks, triggering broad-based gains across financials.
Goldman Sachs (NYSE:GS) and Morgan Stanley (NYSE:MS), both of which reported above-forecast earnings and revenue on Tuesday, rose nearly 3%.
But a weaker-than-expected report from IBM (NYSE:IBM) saw its stock spiral 7.6% lower as the company struggled to maintain revenue growth, though its earnings came in above Wall Street's estimates.
Falling energy stocks inflicted much of the damage on the broader averages owing to a slump in oil prices after data showed a larger-than-expected build in domestic oil supplies.
The yo-yo day of trade on Wall Street, which was characterized by violent swings in both directions, was not helped by soft housing data, triggering a slump in homebuilders.
The Commerce Department said Wednesday U.S. homebuilding fell 5.3% to a seasonally adjusted annual rate of 1.201 million units in September. Building permits fell 0.6% to a rate of 1.241 million units.
Shares of Lennar (NYSE:LEN), KB Home (NYSE:KBH) and DR Horton (NYSE:DHI) slumped more than 2%.
In corporate news, Tesla (NASDAQ:TSLA) fell 1.74% following reports that CEO Elon Musk had informed the electric car company that he intended to purchase $20 million of common stock during the next open trading window.
Top S&P 500 Gainers and Losers Today:
United Continental (NASDAQ:UAL), Netflix (NASDAQ:NFLX) and US Bancorp (NYSE:USB) were among the top S&P 500 gainers for the session.
IBM (NYSE:IBM), AutoZone (NYSE:AZO) and Campbell Soup (NYSE:CPB) were among the worst S&P 500 performers of the session.
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