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Wall Street Reacts to Fed Rate Cut

S&P stocks were in the red on Wednesday after the Federal Reserve cut interest rates by 25 points. The Dow Jones Industrial Average gained 0.11% to 27,100, the S&P 500 Index declined 0.17% to 3,031 and the Nasdaq Composite Index rose 0.01% to 8,277.

Non-index stocks also posted gains and losses. Shares of Advanced Micro Devices Inc. (NASDAQ:AMD) declined nearly 2% on Wednesday after the company announced third-quarter results. The chipmaker posted earnings of 18 cents per share, which were in line with analysts' estimates. Revenue of $1.8 billion fell $10 million short of expectations.


"Our first full quarter of 7nm Ryzen, Radeon and EPYC processor sales drove our highest quarterly revenue since 2005, our highest quarterly gross margin since 2012 and a significant increase in net income year-over-year," CEO Lisa Su said.

The gross margin was 43%, up 3 percentage points year over year and 2 percentage points quarter over quarter, due to higher RyzenTM and EPYCTM processor sales.

The operating income was $186 million, an increase from $150 million a year ago. Further, the non-GAAP operating income was $240 million compared to $186 million a year ago. The increase was driven by higher revenue in the computing and graphics segment.

Looking ahead to the fourth quarter, the company expects revenue to be about $2.1 billion, a 48% year-over-year increase. It also guided for the non-GAAP gross margin to be approximately 44%.

During the quarter ended June 30, Paul Tudor Jones (Trades, Portfolio) boosted his holding by 365% to 47,787 shares, while Steven Cohen (Trades, Portfolio) curbed his stake by 6% to 4,958,587 shares and Caxton Associates (Trades, Portfolio) sold out of the stock.

Gainers

  • General Electric Co. (NYSE:GE) +9%
  • Centene Corp. (NYSE:CNC) +7.5%
  • Garmin Ltd. (NASDAQ:GRMN) +6.9%
  • Masco Corp. (NYSE:MAS) +3.5%
  • Concho Resources Inc. (NYSE:CXO) +2.9%



Losers

  • McKesson Corp. (NYSE:MCK) -8.5%
  • Edison International (NYSE:EIX) -7.5%
  • Yum Brands Inc. (NYSE:YUM) -6.6%
  • Nordstrom Inc. (NYSE:JWN) -6.1%
  • L Brands Inc. (NYSE:LB) -5.3%



Global markets

The main European stock markets traded mixed. The U.K.'s FTSE 100 rose 0.34%, France's CAC 40 gained 0.45%, Germany's Dax declined 0.23% and Spain's IBEX 35 dipped 1.23%.

In Asia, Japan's Nikkei 225 fell 0.57%, India's BSE Sensex rose 0.55%, Hong Kong's Hang Seng declined 0.44% and China's Shanghai Composite slid 0.50%.

Disclosure: The author holds no positions in any stocks mentioned.

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This article first appeared on GuruFocus.