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Stock Market Turns Cautious Ahead of Federal Reserve Decision

Strategic Insights

— 1 min read

The New York Stock Exchange (NYSE) turned mostly lower in cautious trading on Tuesday as investors awaited news from the Federal Reserve on whether to raise interest rates further. Despite a slight increase in the Dow Jones industrial average, the NYSE composite index and Standard & Poor's 500-stock index both declined. Trading volume was lower than the previous day, with 75.21 million shares changing hands compared to 79.36 million.

Key Takeaways:

  • The Dow Jones industrial average was up 5.18 points to 3870.03 at 11 a.m. EST, but the NYSE composite index was off 0.03 to 259.88.
  • The Standard & Poor's 500-stock index fell 0.23 to 468.31, with declines outpacing advances 872-832 among 2,471 issues.
  • Trading volume was 75.21 million shares, down from 79.36 million in the same period Monday.
  • The 30-year Treasury bond was ahead of a point, with its yield decreasing to 6.92 percent.
  • Analysts attributed the market's caution to the anticipation of the Federal Reserve's decision on interest rates.
  • Highly-rated security stocks, such as RJR Nabisco Holdings and Merck, led the actives list on the NYSE.
  • Novell's rating downgrades from Dean Witter Reynolds, Alex. Brown & Sons, and CS First Boston led to a 3-point decline to 20 on the Nasdaq Stock Market.

Statistics:

  • The Dow Jones industrial average increased by 5.18 points to 3870.03 at 11 a.m. EST.
  • The NYSE composite index declined by 0.03 to 259.88.
  • The Standard & Poor's 500-stock index fell 0.23 to 468.31.
  • The 30-year Treasury bond yield decreased to 6.92 percent.
  • Trading volume was 75.21 million shares, down from 79.36 million in the same period Monday.
  • The U.S. trade deficit rose to $6.3 billion in January, a 51.8 percent increase.

Sources:

  • "Stock prices turn mostly lower in cautious trading" by an unnamed author, published in the New York (no date specified)
  • "Federal Reserve futures talk sends stocks into a funk" by Samantha Schmidt, published in the New York Business (no date specified)
  • US Department of Commerce, "U.S. Bureau of Economic Analysis" (no date specified)

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