Stock Market News for August 22, 2016

Benchmarks finished in the red on Friday following concerns over chances of a sooner-than-expected rate hike. Fears regarding rate hike heightened following hawkish comments from San Francisco Fed President John Williams. This in turn weighed on debt heavy sectors like utilities and telecom. However, the Nasdaq managed to end in the green for the week, registering gains for eight consecutive weeks for the first time since April 23, 2010.

For a look at the issues currently facing the markets, make sure to read today's Ahead of Wall Street article.

The Dow Jones Industrial Average (DJI) decreased more than 0.2%, to close at 18,552.57. The S&P 500 fell more than 0.1% to close at 2,183.87. The tech-laden Nasdaq Composite Index closed at 5,238.38 losing 1.77 points. The fear-gauge CBOE Volatility Index (VIX) decreased 0.8% to settle at 11.34. A total of around 5.7 billion shares were traded on Friday, lower than the last 20-session average of 6.4 billion. Decliners outpaced advancing stocks on the NYSE. For 39% stocks that advanced, 57% declined.

What Pulled Markets Down?

San Francisco Fed President John Williams said that a "sooner rather than later" rate increase might be appropriate as the domestic economy is strengthening and is maintaining "good momentum." Higher chances of a rate hike in September weighed on utilities and telecom stocks.

The Utilities Select Sector SPDR XLU decreased 1.2% and was the worst performer among the S&P 500 sectors. Key utilities stocks including NextEra Energy, Inc. NEE, Duke Energy Corporation DUK, Exelon Corporation EXC and Dominion Resources, Inc. ( D) fell 1.5%, 1.4%, 1% and 1.4%, respectively.

Further, the telecom services sector within the S&P 500 also lost 0.9%. Some of its key holdings including AT&T, Inc. ( T), CenturyLink, Inc. CTL, Verizon Communications Inc. VZ and Frontier Communications Corporation ( FTR) decreased 0.9%, 1%, 0.8% and 1.9%, respectively.

In earnings news, Deere & Company's DE shares jumped 13.5% after posting a surprise increase in per-share profit and raising guidance. It was the best performer among the S&P 500 components (read more: Deere Tops Q3 Earnings, Misses Sales, Revises View ).

For the week, both the Dow and S&P 500 fell 0.1%, while the Nasdaq rose 0.1%. Rise in rate hike possibilities following hawkish comments from key Fed officials weighed on benchmarks. However, factors including crude hitting one month high, Fed's July meeting minutes, and rise in industrial output and home building curtailed some of the weekly losses.

Stocks that Made Headlines

Pfizer to Buy Medivation for $14B, Boost Cancer Franchise

Pfizer Inc. PFE and Medivation, Inc. MDVN announced that they have entered into a definitive merger agreement under which Pfizer will acquire Medivation for $81.50 per share in cash or a total enterprise value of about $14 billion. ( Read More)

IEX Stock Exchange Makes Long-Awaited Public Launch

The Investors Exchange IEX Group's controversial new national stock exchange made its public launch. (Read More)

Viacom & National Amusements Agree to Leadership Changes

Viacom Inc. VIAB has finally reached an agreement relating to leadership changes with National Amusements Inc. NAI, the company which holds majority of the controlling shares in Viacom. (Read More)

Will Pandora Start On-Demand Streaming Service Soon?

Recent media reports revealed that Pandora Media, Inc. P may be close to launching its on-demand music streaming service. (Read More)

Boeing Wins $2.8B Air Force Contract for KC-46 Tankers

The Boeing Co. BA clinched the much anticipated $2.8 billion contract from the U.S. Air Force for the first lot of 19 KC-46 Pegasus aerial tankers. (Read More)

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report >>

Market News and Data brought to you by Benzinga APIs

Get Our Top Trade Ideas Delivered Daily - 65% Off Now

Get Our Top Trade Ideas Delivered Daily - 65% Off Now

Comments