Asia Morning: U.S. Stocks Lack Upward Momentum

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The U.S. Federal Reserve said it would keep interest rates near zero at least through 2023...

Trading floor 2

On Wednesday, U.S. stocks scrapped earlier gains to close mixed. The Dow Jones Industrial Average was 36 points higher (+0.13%) to 28032, while the S&P 500 declined 15 points (-0.46%) to 3385 and the Nasdaq 100 sank 191 points (-1.67%) to 11247.


Nasdaq 100 Index: Daily Chart


Sources: GAIN Capital, TradingView


As expected, the Federal Reserve decided to keep the its key interest rate unchanged at 0.00%-0.25%. The central bank said it would keep interest rates near zero at least through 2023.

Energy (+4.04%), Banks (+1.43%) and Capital Goods (+1.43%) sectors performed the best, while Technology Hardware & Equipment (-2.33%), Retailing (-1.67%) and Media (-1.4%) sectors lagged behind. Energy companies such as Occidental Petroleum (OXY +8.68% to $11.64), Diamondback Energy (FANG +7.9% to $32.91) and Marathon Oil (MRO +5.07% to $4.56) rallied as oil prices surged 5.0%.
  
General Electric (GE +10.66%) was the top gainer, while Illumina Inc (ILMN -8.44%) and NVIDIA Corp (NVDA -3.67%) were among the top losers.   

Approximately 64.2% (same as in the prior session) of stocks in the S&P 500 Index were trading above their 200-day moving average and 53.7% (52.5% in the prior session) were trading above their 20-day moving average.

U.S. official data showed that Retail Sales rose 0.6% on month in August (+1.0% expected).

European stocks were broadly higher. The Stoxx Europe 600 Index advanced 0.58%, Germany's DAX 30 gained 0.29%, France's CAC 40 edged up 0.13%, while the U.K.'s FTSE 100 retreated 0.44%.

The benchmark U.S. 10-year Treasury yield increased one basis point to 0.688%.

U.S. WTI crude oil futures (October) jumped 4.9% to $40.16 a barrel. Oil prices rose after the U.S. Energy Information Administration reported an unexpected reduction of 4.4 million barrels in crude-oil stockpiles (+1.3 million barrels expected).

Spot gold rose $5.00 (+0.25%) to $1,959 an ounce.

On the forex front, the ICE U.S. Dollar Index was broadly stable at 93.10, as the Fed signal that it would keep interest rates at current level through 2023.

EUR/USD dropped 0.3% to 1.1810.

GBP/USD rose 0.6% to 1.2961, posting a three-day rebound. Official data showed that U.K. CPI grew 0.2% on year in August (flat expected). Later today, The Bank of England is expected to keep its monetary policy unchanged (benchmark rate at 0.10% expected).

USD/JPY slid 0.4% to 105.01, down for a third straight session. The Bank of Japan is widely expected to hold its benchmark rate at -0.10% later in the day.

USD/CAD was little changed at 1.3176. Government data showed that Canada's CPI grew 0.1% on year in August (+0.4% expected).

Meanwhile, NZD/USD gained 0.2% to 0.6732, extending its rally to a fourth straight session. New Zealand's economy shrank 12.4% on year in the second quarter (-12.8% expected), according to the government.


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