U.S. stocks ended lower on Wednesday after volatile swings in the final minutes of the trading session, retreating from a massive two-day rally earlier in the week.
Shares fell for most of the session, then turned positive towards the end of the day, only to reverse those short-term gains at the end. The S&P 500’s energy sector rose as oil prices rose after OPEC+ said it would cut production by 2 million barrels a day starting in November.
“The recent rally can likely be driven by deeply oversold conditions plus some positive items on the ‘pivot’ Fed story, including a big drop in US job vacancies and a smaller-than-expected rate hike in Australia,” Ross Mayfield, Investment Strategist, Baird Private Wealth Management, he told Insider in emailed comments.
“However, the bar for a real Fed ‘pivot’ remains much higher and there is still little sign that core inflation is easing enough for the Fed to get comfortable,” he said.
Here are the US indices at the 4pm closing bell on Wednesday:
- S&P 500: 3,783.28, down 0.20%
- Dow Jones Industrial Average: 30,273.87, down 0.14% (42.45 points)
- Nasdaq Composite: 11,148.64, down 0.25%
ADP’s private-sector jobs report early Wednesday showed employers added 208,000 payrolls in September, slightly above the Econoday consensus estimate of 200,000. The report was the second under ADP’s new methodology and came ahead of Friday’s US government September report about non-farming.
“We remain cautiously positioned, as we have been for most of this year, with a smaller-than-usual allocation to equities and a larger-than-usual allocation to high-quality bonds and global infrastructure,” Bill Merz, head of capital markets research at US Bank Wealth. Management, Insider said.
“Investors have been looking for signs of the Fed pivoting, but we think it’s highly unlikely until inflation drops significantly. Unfortunately, measures like the Cleveland Fed’s reduced median CPI and the Atlanta Fed’s ‘sticky CPI’ (which tracks components of the CPI that are slow to change) are still rising, suggesting that inflation may take some time to die down to the extent the Fed needs to see.”
Here’s what’s happening today:
- Elon Musk will have to offload more Tesla shares to fund his takeover of Twitter, and that could lead to further declines in the electric vehicle maker’s shares, Wedbush’s Dan Ives said.
- Carl Icahn made an estimated $250 million profit on Twitter stock by calling Musk’s bluff.
- Banks that arranged financing for Elon Musk’s $12.5 billion Twitter deal are reportedly facing steep losses as appetite for riskier debt wanes.
- The pound fell against the dollar, erasing a brief rally as British Prime Minister Liz Truss defended her plan to cut taxes.
For commodities, bonds and cryptocurrencies:
- West Texas Intermediate crude rose 1.3% to $87.72 a barrel. Brent crude, the international benchmark, rose 1.7% to $93.40.
- Gold fell 0.2% to $1,726.60 an ounce.
- The 10-year Treasury yield rose 11 basis points to 3.75%.
- Bitcoin fell 0.7% to $20,197.04.