Dow Flips After Fed, Falls to New Annual Low

The Fed projected just two more rate hikes in 2019

by Patrick Martin

Published on Dec 19, 2018 at 4:29 PM

It was another late-session bloodbath on Wall Street. The Dow finished over 350 points in the red and marked a new annual low, retreating in the final hours of trading after spending most of the day in the black. The blue-chip index explored a range of nearly 900 points today, swinging from a triple-digit gain to a triple-digit loss after the Federal Reserve officially lifted its benchmark interest rate by a quarter point, defying pleas from President Donald Trump. The Fed policy statement projected two more "gradual" hikes for 2019, one less than its prior forecast from September, and Fed Chair Jerome Powell said he is satisfied with the balance sheet runoff. The S&P and Nasdaq both ended significantly lower as well, hitting new annual lows of their own.

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

  • These are the worst stocks to own after a rate hike.
  • Behind today's big General Electric stock rally.
  • Why one prison stock sold off.
  • Plus, a Nike earnings preview; a big Allergan options trade; and 2 pharma stocks to keep an eye on.

The Dow Jones Industrial Average (DJI - 23,323.66) ended 351.9 points lower, or 1.5%, and touched an annual low of 23,162.64. Of the 30 the Dow components, only Verizon (VZ) ended the day higher with a 0.4% gain. Chip stock Intel (INTC) paced the 29 others with a 4.5% drop.

The S&P 500 Index (SPX - 2,506.96) shed 39.2 points, or 1.5%, after touching a new low of 2,488.96. The Nasdaq Composite (IXIC - 6,636.83) dove 147.1 points, or 2.2%, after marking a new annual low of 6,586.50.

The Cboe Volatility Index (VIX - 25.58) ended the day flat.

closing indexes summary december 19

nyse and nasdaq stats december 19

5 Items on our Radar Today

  1. The U.S. announced earlier today that it's withdrawing its armed forces from Syria, and reports suggest the White House will consider a full exit. The buzz has been derided by lawmakers from both political parties, as a full withdrawal potentially leaves the unstable area ripe for ISIS, Iranian, and Russian influence. (Reuters)
  2. Following another scathing New York Times report that questioned the company's privacy tactics, Facebook (FB) is now facing legal pressure from Washington, D.C. The D.C. attorney general has filed a lawsuit against the social media entity for its role in the Cambridge Analytica scandal. (CNBC)
  3. Nike stock just flashed a death cross ahead of earnings.
  4. An Allergan recall didn't phase this options bull.
  5. 2 pharma stocks flashing bullish signals.

corporate earnings december 19

unusual options activity december 19

Data courtesy of Trade-Alert

Oil Bounces Back, Gold Volatile

Oil futures bounced back today, jumping after the Energy Information Administration (EIA) report indicated U.S. crude supplies fell last week. January-dated crude futures -- which expire today -- added 96 cents, or 2.1%, to finish at $47.20 per barrel.

Gold futures were volatile today, ultimately settling near five-month highs. February-dated gold futures added $2.80, or 0.2% to settle at $1,256.40 an ounce. However, once the Fed raised interest rates, the metal pulled back in electronic trading.



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