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Market Wrap for Wednesday, August 7: Uncertainty Over Fed Timeline Weighs On Sentiment

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Market Wrap for Wednesday, August 7: Uncertainty Over Fed Timeline Weighs On Sentiment

The U.S. stock market recorded small losses on Wednesday as investor uncertainty over the Fed's timeline for tapering its quantitative easing program continued to weigh on sentiment.

The U.S. Dollar also was lower on the day along with crude oil. Precious metals rose slightly on the session while U.S. Treasuries staged a rally amid mild weakness in risk assets.

Volume remained low as many on Wall Street are on summer vacation, even as corporate earnings season rolls on.

Major Averages

The Dow Jones Industrial Average fell 48 points, or 0.31 percent, to 15,471.

The S&P 500 lost a little more than 6 points, or 0.38 percent, to 1,691.

The Nasdaq shed around 12 points, or 0.32 percent, to close at 3,654.

Consumer Credit

Consumer credit rose by $13.8 billion in June after rising $17.5 billion in May. This compared to consensus expectations calling for an expansion in consumer credit of $16.0 billion in the month.

Related: Apple dominates PC sales in the second-quarter.

Commodities

Crude oil fell for the second day on Wednesday. In afternoon trade, NYMEX crude futures were down 0.90 percent to $104.35 while Brent crude futures had lost 0.68 percent to $107.44. Natural gas shed more than 2 percent on the session and was last trading at $3.25.

Gold and silver were both slightly higher on Wednesday. At last check, COMEX gold futures were up 0.34 percent to $1,285.90 while silver futures had added 0.09 percent to $19.54. Copper contracts rose 0.36 percent on the session and were trading at $3.1845.

In the grains complex, both corn and wheat were lower. Corn futures were trading down 0.22 percent at last check while wheat had lost a little more than 1 percent. Movers in soft commodities included cocoa and cotton. Cocoa futures rose a little less than 3 percent while cotton was trading up slightly more than 3 percent.

Bonds

Treasuries rose on Wednesday as stocks fell. Near the close of equities, the iShares Barclays 20+ Year Treasury Bond ETF (NYSE: TLT) was up 0.78 percent to $106.84. Yields fell as prices rose on the session.

Treasury yields were as follows on Wednesday afternoon: The 2-Year Note was yielding 0.30 percent while the 5-Year Note yield was 1.36 percent. The 10-Year Note and 30-Year Bond were yielding 2.59 percent and 3.68 percent, respectively.

Related: Investors remain bullish on Tesla ahead of earnings.

Currencies

Late in the day, the U.S. Dollar was sitting on moderate losses. The PowerShares DB US Dollar Index Bullish ETF (NYSE: UUP), which tracks the performance of the greenback versus a basket of foreign currencies, was down 0.41 percent to $21.98.

The closely watched EUR/USD pair was up 0.20 percent to $1.3332. Other movers included the USD/JPY, which fell 1.30 percent, and the GBP/USD, which rose 0.91 percent on Wednesday.

Volatility and Volume

The CBOE Volatility Index (VIX) recorded a small gain on the session as stocks fell. Late in the day, the VIX was up around 2 percent to 12.98.

Volume remained muted on Wednesday amid low trading activity on Wall Street. Around 66 million SPDR S&P 500 ETF (NYSE: SPY) shares traded hands compared to a 3-month daily average of 133.5 million.

Related: Wednesday's top financial tweets!

Stock Movers

Finisar (NASDAQ: FNSR) climbed more than 15 percent on the day after the company announced better-than-expected preliminary first-quarter results.

Sapient's fiscal second-quarter earnings results were a catalyst for the stock which was trading up more than 15 percent late in the day.

Strong second-quarter results from Caesarstone Sdot-Yam (NASDAQ: CSTE) sent that stock up more than 15 percent in late trade on Wednesday.

Higher second-quarter profit and revenue that came in better than analysts' expectations sent shares of Live Nation up more than 12 percent on the day.

Santarus (NASDAQ: SNTS) released better-than-expected Q2 financial results and boosted its full-year outlook, sending the stock up better than 9 percent in late trade on Wednesday.

Sunedison (NYSE: SUNE) reported a wider second-quarter loss, sending the stock down around 24 percent late in the day.

Solar firm First Solar (NASDAQ: FSLR) plunged after reporting disappointing results for its fiscal second-quarter. The stock was last down almost 14 percent late in the session.

Despite beating Wall Street Q2 earnings estimates, shares of Demandware (NYSE: DWRE) were down more than 10 percent on Wednesday.

Shares of solar company SunPower (NASDAQ: SPWR) fell around 10 percent on the day in sympathy with First Solar.

SandRidge Energy's (NYSE: SD) fiscal second-quarter earnings results failed to impress investors who sent the stock down more than 9 percent on Wednesday.

 

Related Articles (DWRE + CSTE)

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