Dovish Fed Lifts Dow Jones Industrial Average; Tech Tanks

A Bold Bet on Yahoo; Plus, Amazon Earnings Ahead

by Alex Eppstein

Published on Apr 27, 2016 at 4:24 PM

The Dow Jones Industrial Average (DJIA) turned higher around midday, and kept the upward momentum going after the Federal Open Market Committee (FOMC) decided not to change interest rates. Specifically, the Fed cited slowing economic activity and sluggish consumer spending trends as reasons for not hiking rates, adding that it expects "only gradual increases" moving forward. Additionally, the FOMC removed the reference to overseas "risks." While the Dow and broader S&P 500 Index (SPX) advanced, the Nasdaq Composite (COMP) was pressured lower as Apple Inc. (NASDAQ:AAPL) earnings weighed heavily on tech stocks. 

 Continue reading for more on today's market, including:

The Dow Jones Industrial Average (DJIA - 18,041.55) tacked on 51.2 points, or 0.3%, closing atop the 18,000 millennium level for the first time this week. Twenty-two of the Dow's 30 components gained, led by Boeing Co (NYSE:BA), up 2.9% on a positive earnings reaction. On the flip side, AAPL paced the eight blue-chip losers, falling 6.3%.

The S&P 500 Index (SPX - 2,095.15) added 3.5 points, or 0.2%, with its upward momentum stalling just below the round 2,100 level. Meanwhile, the Nasdaq Composite (COMP - 4,863.14) slid 25.1 points, or 0.5%.

The CBOE Volatility Index (VIX - 13.77) inched 0.2 point, or 1.4%, lower, but maintained a foothold atop its 10-day moving average.


Indexes Closing Summary April 27_

NYSE and Nasdaq Stats April 27

5 Items on Our Radar Today:

  1. The Fed chose not to lift interest rates following a two-day meeting, and gave few hints as to a June increase. The central bank did note the improving job market, though, and that household incomes have risen at a "solid rate." (Reuters)

  2. Pending home sales hit a 10-month high in March, with the National Association of Realtors' gauge rising 1.4% to 110.5. Economists were calling for a slimmer 0.7% rise in the pending home sales index. (MarketWatch)

  3. Even 6 million free burritos weren't enough to keep Chipotle Mexican Grill, Inc. (NYSE:CMG) from its first-ever quarterly loss

  4. The pharmaceutical company back in the hot seat over price gouging.

  5. Twitter Inc (NYSE:TWTR) announced quarterly results that were #disappointing, sparking a mass exodus of bullish analysts.

Quarterly Earnings April 27

Unusual Options Activity April 27
Data courtesy of
Trade-Alert

Commodities:

Oil futures spiked after the Fed's decision to keep interest rates as is, after earlier sinking on an Energy Information Administration (EIA) report showing record crude inventory levels. By day's end, June-dated crude futures were up $1.29, or 2.9%, at $45.33 per barrel -- a 2016 high.

Gold managed to muscle higher as lackluster economic data pressured the dollar, but the malleable metal lost some momentum after-hours following the Fed's policy announcement. At the close, though, June-dated gold had tacked on $7, or 0.6%, to settle at $1,250.40 per ounce.

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