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Stock prices

Stocks Slide as Fed Rate Hike Fades

Strategic Insights

— 4 min read

The markets saw a significant decline on Thursday, following a substantial gain the day before. The mining sector was hit hard as the price of gold and copper plummeted. A proposed Congressional budget deal, however, sent solar power stocks soaring. Investor confidence was boosted by the Federal Reserve's decision to raise interest rates for the first time in nearly a decade, with the emphasis on gradual increases.

Key Takeaways:

  • The Dow Jones industrial average declined 107 points, or 0.6 percent, to 17,641 as of 11:03 a.m. Eastern.
  • The Standard & Poor's 500 index fell 16 points, or 0.8 percent, to 2,057.
  • The Nasdaq composite index lost 27 points, or 0.5 percent, to 5,044.
  • The price of gold sank $22.70, or 2.1 percent, to $1,054.10 an ounce.
  • The price of copper fell 3 cents, or 1.3 percent, to $2.04 a pound.
  • Solar power stocks continued to rise after Congress agreed to extend a federal tax credit for commercial and residential solar products.
  • SolarCity gained $3.67, or 6.8 percent, to $57.36 and Sunrun added 39 cents, or 3.4 percent, to $12.02.
  • The dollar climbed as the Fed raised interest rates, with the euro dropping to $1.0865 from $1.0970 and the yen rising to 122.64 from 121.85.
  • U.S. government bond prices rose, with the yield on the 10-year Treasury note falling to 2.26 percent from 2.30 percent.
  • European markets saw significant gains, with Germany's DAX rising 2.8 percent.
  • Asia's markets also saw gains, with Japan's Nikkei 225 jumping 1.6 percent and Hong Kong's Hang Seng rising 0.8 percent.

Statistics:

  • 107 points: The decline in the Dow Jones industrial average as of 11:03 a.m. Eastern.
  • 0.6 percent: The decline in the Dow Jones industrial average as of 11:03 a.m. Eastern.
  • 16 points: The decline in the Standard & Poor's 500 index.
  • 0.8 percent: The decline in the Standard & Poor's 500 index.
  • 27 points: The decline in the Nasdaq composite index.
  • 0.5 percent: The decline in the Nasdaq composite index.
  • $22.70: The decline in the price of gold.
  • 2.1 percent: The decline in the price of gold.
  • 3 cents: The decline in the price of copper.
  • 1.3 percent: The decline in the price of copper.
  • $1,054.10: The price of gold as of 11:03 a.m. Eastern.
  • $2.04: The price of copper as of 11:03 a.m. Eastern.
  • $1.0865: The exchange rate for the euro.
  • 2.26 percent: The yield on the 10-year Treasury note.
  • 2.30 percent: The yield on the 10-year Treasury note late Wednesday.
  • 122.64: The exchange rate for the yen.
  • 121.85: The exchange rate for the yen late Wednesday.

Sources:

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"U.S. stocks are sliding Thursday morning after a big rally the day before. Mining companies fell along with the price of gold and copper, while a proposed Congressional budget deal sent solar power companies higher." - Marley Jay, AP (http://twitter.com/MarleyJayAP)

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"KEEPING SCORE: The Dow Jones industrial average declined 107 points, or 0.6 percent, to 17,641 as of 11:03 a.m. Eastern. The Standard & Poor's 500 index fell 16 points, or 0.8 percent, to 2,057. The Nasdaq composite index lost 27 points, or 0.5 percent, to 5,044." - Marley Jay, AP (http://twitter.com/MarleyJayAP)

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"The Fed gains fade: Stocks jumped Wednesday after the Federal Reserve raised interest rates, a long-expected vote of confidence in the U.S. economy." - Marley Jay, AP (http://twitter.com/MarleyJayAP)

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"FedEx delivers: Shipping company FedEx said its quarterly profit grew as online shopping increased and costs in its express-delivery business came down. FedEx rose $4.19, or 2.8 percent, to $153.02." - Marley Jay, AP (http://twitter.com/MarleyJayAP)

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"Avon gets a call: Avon Products rose after the beauty products retailer said it will sell its North American business to Cerberus Capital Management for $170 million." - Marley Jay, AP (http://twitter.com/MarleyJayAP)

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"Miners slide: The price of gold sank $22.70, or 2.1 percent, to $1,054.10 an ounce and copper fell 3 cents, or 1.3 percent, to $2.04 a pound." - Marley Jay, AP (http://twitter.com/MarleyJayAP)

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"Solar power shines: Solar power stocks continued to rise after Congress agreed to extend a federal tax credit for commercial and residential solar products." - Marley Jay, AP (http://twitter.com/MarleyJayAP)

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"Pandora: Streaming music company Pandora Media surged. A panel of copyright judges raised the amount that streaming companies like Pandora have to pay to record labels, but less than many had expected." - Marley Jay, AP (http://twitter.com/MarleyJayAP)

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"Oracle: Business software maker Oracle slipped after the company reported a smaller quarterly profit. Its revenue also fell short of analyst forecasts." - Marley Jay, AP (http://twitter.com/MarleyJayAP)

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"Currencies: The dollar climbed. While the Fed is raising interest rates, central banks in Europe and Japan are planning to lower them." - Marley Jay, AP (http://twitter.com/MarleyJayAP)

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"Bonds: U.S. government bond prices rose. The yield on the 10-year Treasury note fell to 2.26 percent from 2.30 percent late Wednesday." - Marley Jay, AP (http://twitter.com/MarleyJayAP)

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"Europe: Germany's DAX rose 2.8 percent while the CAC-40 in France rose 1.7 percent." - Marley Jay, AP (http://twitter.com/MarleyJayAP)

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"Asia's day: Japan's Nikkei 225 jumped 1.6 percent and Hong Kong's Hang Seng rose 0.8 percent." - Marley Jay, AP (http://twitter.com/MarleyJayAP)

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"Energy: Benchmark U.S. crude dipped 60 cents, or 1.7 percent, to $34.92 a barrel in New York." - Marley Jay, AP (http://twitter.com/MarleyJayAP)

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