Dow Jones Rises Ahead Of Fed Rate Hike, Powell Comments; Tesla Stock
The Dow Jones Industrial Average rose Wednesday ahead of this afternoon’s Federal Reserve interest rate decision, followed by a press conference with Fed Chair Jerome Powell. Best Buy (BBY) dropped more than 3% after a Bank of America downgrade.
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Fed Decision, Powell Comments
The Fed’s two-day policy meeting concludes Wednesday. An interest rate decision is due at 2 p.m. ET followed by comments from Fed chief Powell at 2:30 p.m.
The Fed has signaled that it will step down the pace of rate hikes this meeting, with widespread expectations of a half-point rate hike to a range of 4.25% to 4.5%. However, it’s unclear how much Tuesday’s more moderate-than-expected November CPI inflation report could potentially affect the Fed’s rate-hike outlook.
It may not make much of a difference, but investors will be carefully parsing Jerome Powell’s comments, following signals that the Fed could be shifting its stance on inflation. According to the CME’s FedWatch tool, traders place a 79% chance of a 50-basis-point rate hike.
Early Tuesday, REV Group (REVG) and Weber (WEBR) reported their quarterly earnings results. REVG stock soared 18%, while Weber shares moved up less than 1%. Other earnings reports this week include Darden Restaurants (DRI) and Lennar (LEN).
Best Buy shares declined more than 3% after Bank of America downgraded the stock to underperform from neutral, with a new price target at 69, down from 80. Delta Air Lines (DAL) jumped more than 3% after raising its fourth-quarter guidance and issuing an upbeat outlook for fiscal-year 2022 and 2023.
Electric-vehicle giant Tesla (TSLA) traded down almost 2% Wednesday. Dow Jones tech leaders Apple (AAPL) and Microsoft (MSFT) were mixed after today’s stock market open.
Allegro Microsystems (ALGM), IBD Leaderboard stock Dexcom (DXCM), KLA (KLAC) and United Rentals (URI) — as well as Dow Jones names Caterpillar (CAT), Home Depot (HD) and UnitedHealth Group (UNH) — are among the top stocks to buy and watch.
Dexcom and Trane are IBD Leaderboard stocks. UnitedHealth was featured in this week’s Stocks Near A Buy Zone column. Allegro was a recent IBD 50 Stocks To Watch pick. Caterpillar, United Rentals and Dexcom were recent IBD Stock Of The Day companies.
Dow Jones Today: Oil Prices, Treasury Yields
After Wednesday’s opening bell, the Dow Jones Industrial Average moved up 0.5%, while the S&P 500 rose 0.45%. The tech-heavy Nasdaq composite gained 0.4% in morning action, with Charter Communications (CHTR) diving more than 8% to the bottom of the index. A handful of analysts cut their price target on Charter after the company increased its 2023 capital spending guidance on Tuesday.
Among exchange-traded funds, the Nasdaq 100 tracker Invesco QQQ Trust (QQQ) fell 0.1% and the SPDR S&P 500 ETF (SPY) moved up 0.1% early Wednesday.
The 10-year U.S. Treasury yield was little changed at…
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