U.S. Market Indexes Lower as Investors Await Fed Rate Decision
U.S. market indexes were lower to start the week on Monday continuing to erase previous gains and retreating further from new highs. For the day the Dow Jones Industrial Average was down -132.86 points or -0.74 percent to 17732.48. The S&P 500 was also down, closing at 2079.06 for a loss of -17.01 points or -0.81 percent. The Nasdaq Composite closed lower at 4848.44 for a loss of -46.11 points or -0.94 percent.
Source: DJIA, S&P 500 and Nasdaq Composite. Google Finance.
Volatility in market trading was high on Monday as the Federal Reserve’s June rate decision is only a few days away. The Federal Reserve’s Federal Open Market Committee will meet on Tuesday and Wednesday, June 14 and 15 to discuss the Fed’s monetary policy. The VIX Volatility Index reached a new high prior to the mid-week meeting. The VIX Volatility Index reached 20.92 for a gain of 3.89 points or 22.84 percent.
Monday’s Market Movers
No economic reports were scheduled for Monday and the economic focus continues to remain on the FOMC’s Wednesday press conference which will include the Fed’s decision on a rate increase as well as the projections of the committee members.
On Monday, stocks trading actively included Microsoft, Bank of America, Apple, Intel, General Electric and Facebook.
Microsoft and LinkedIn were both active Monday as the two companies announced a merger. Microsoft will be buying LinkedIn for $196 a share or approximately $26.2 billion. Microsoft will pay cash for the deal which values LinkedIn at a 50 percent premium to its Friday closing price.
Apple also traded actively as it began its Worldwide Developers Conference in San Francisco. While the WWDC appears to be a success, the stock continues to fall as demand decreases in the technology sector. For the day the stock was down 1.51 percent to $97.34.
In the Dow Jones Industrial Average, stocks leading gains and losses for the day included:
Exxon Mobil 0.68 percent
McDonald’s 0.51 percent
Intel 0.41 percent
Walt Disney 0.24 percent
Chevron 0.12 percent
Microsoft -2.6 percent
Visa -2.22 percent
American Express -2 percent
Coca-Cola -1.89 percent
Pfizer -1.56 percent
Top sectors reporting losses for the broad market were technology, materials and industrial. In the technology sector the Nasdaq Composite closed lower at 4848.44 for a loss of -46.11 points or -0.94 percent. The Nasdaq 100 was also lower at 4422.76 for a loss of -38.29 points or -0.86 percent. Stocks leading losses in the technology sector for the day included:
Liberty Global -4.1 percent
Microsoft -2.6 percent
Facebook -2.29 percent
In commodities, gold traded higher as evidenced by the SPDR Gold Trust which reported a gain of 0.93 points or 0.76 percent. The dollar was lower for the day as the U.S. Dollar Index closed at 94.35 for a loss of -0.31 points or -0.33 percent.
In small-caps, the Russell 2000 followed the day’s trend lower closing at 1150.70 for a loss of -13.23 points or -1.14 percent. The S&P 600 closed at 704.30 for a loss of -8.28 points or -1.16 percent. The DJ Small-Cap Growth TSM closed at 7031.18 for a loss of -91.69 points or -1.29 percent. The DJ Small-Cap Value TSM closed at 8288.67 for a loss of -87.69 points or -1.05 percent.
Other Notable Indexes
Other notable index closes included the S&P 400 Mid-Cap Index which closed at 1482.32 for a loss of -16.75 points or -1.12 percent; the Russell 3000 closing at 1226.11 for a loss of -10.28 points or -0.83 percent; and the Dow Jones U.S. Select Dividend Index closing at 595.36 for a loss of -4.95 points or -0.82 percent.