Investors await word from Fed
Major stock indexes traded in a tight range as investors waited for word from the Federal Reserve and mulled over a mixed batch of corporate earnings results.
Keeping score: The Standard & Poor’s 500 was down one point to 1,984 as of 12:02 p.m. Eastern time. The Dow Jones industrial average rose eight points, a fraction of a percent, to 17,013. The Nasdaq composite fell 18 points, or 0.4 percent, to 4,546.
Face plant: Facebook lost 6 percent after its chief financial officer said that expenses for the social networking giant could increase by as much as 75 percent next year as it ramps up spending on investments. Its stock dropped $4.75 to $75.99.
Explosion in the sky: Orbital Sciences Corporation sank following news that its Antares rocket exploded moments after lifting off from its launch pad on Tuesday. The rocket was carrying a supply ship for astronauts on the International Space Station, part of Orbital’s contract with NASA. Orbital’s stock plunged $4.55, or 15 percent, to $25.81.
Fed watching: Investors around the world are looking ahead to Wednesday’s announcement from the Fed’s policymaking committee for insight into when the central bank might start raising interest rates. The Fed is also winding down its $4 trillion bond-buying program, known as quantitative easing, or QE for short. Some question whether the U.S. economy and stock market will flounder without the Fed’s stimulus program.
Long view: Marty Leclerc, chief investment officer at Barrack Yard Advisors, said that history suggests the market should be able to handle an interest rate increase. “The stock market typically peaks more than two years after the first Fed-funds rate hike,” he said. “So if you think the ball game is over for the bull-market run, you’re saying this time is going to be different.”
Profits up: Solid earnings from Caterpillar, Microsoft and other big companies have helped the market recover from a deep slide earlier this month. Nearly half of the big companies in the S&P 500 index have turned in third-quarter results, and more than seven out of 10 have trumped analysts’ targets, according to S&P Capital IQ. Earnings are on track to rise 6 percent for the third quarter.
Bouncing back: The S&P 500 index is now up half a percent for the month of October. The benchmark index had slumped as much as 6 percent on October 15, as a host of concerns sent markets tumbling.
Europe: Germany’s DAX rose 0.4 percent, and the CAC-40 in Paris inched up 0.3 percent. Britain’s FTSE 100 rose 0.8 percent.
Asia’s day: In Asia, industrial output figures showed Japan’s recovery remains on track, adding to market optimism. Tokyo’s Nikkei, the benchmark for the region’s biggest stock market, picked up 1.5 percent. South Korea’s Kospi gained 1.8 percent. Hong Kong’s Hang Seng added 1.3 percent.
Oil: Benchmark U.S. crude rose $1.13 to $82.55 a barrel on the New York Mercantile Exchange.
This story was originally published October 29, 2014 at 11:27 AM with the headline "Investors await word from Fed."