Crude oil is getting smoked, IBM shares tumble 5% – Yahoo Finance
Stocks finished mixed on Wednesday, with the Dow being dragged down by a roughly 5% loss in shares of IBM (IBM) and biotech stocks helping the tech-heavy Nasdaq stay in positive territory.
The Dow fell 120 points, or 0.6%, the S&P 500 fell 4 points, or 0.2%, and the Nasdaq gained 13 points, or 0.2%. The big mover on Wednesday was oil, with WTI crude prices falling about 4%. The 10-year Treasury yield settled near 2.21%; the 2-year settled near 1.18%.
Elsewhere in markets, the latest Federal Reserve Beige Book gave some commentary on the economy that runs a bit counter to the more negative data readings we’ve seen in recent weeks.
The day’s biggest story, however, was not explicitly related to markets as Fox News announced host Bill O’Reilly would not return to the network.
Update 2:38 p.m. ET
It’s official: Bill O’Reilly will not be returning to Fox News.
In a statement on Wednesday, 21st Century Fox said, “After a thorough and careful review of the allegations, the Company and Bill O’Reilly have agreed that Bill O’Reilly will not be returning to the Fox News Channel.”
In an email to Fox News employees obtained by The New York Times’ Emily Steel, the company said, “This decision follows an extensive review done in collaboration with outside counsel… We have full confidence that the network will continue to be a powerhouse in cable news. Lastly, and most importantly, we want to underscore out consistent commitment to fostering a work environment built on the values of trust and speed.”
Update 2:16 p.m. ET
Crude oil is getting smoked.
Near 2:15 p.m. ET in New York, West Texas Intermediate crude oil futures were down nearly 4%. WTI is now closing in on $50 a barrel, a level oil hasn’t traded below so far this month.
A Bloomberg report on Wednesday noted that data this morning showed gasoline stockpiles in the US. rose last week, in contrast with an expected decline. Crude oil production also rose to its highest since August 2015.
Update 2:10 p.m. ET
The Federal Reserve’s latest Beige Book is out.
The report, a collection of economic anecdotes from each of the Fed’s 12 districts, indicated that economic activity increased across the country from mid-February through the end of March.
“Manufacturing continued to expand at a modest to moderate pace, although growth in freight shipments slowed slightly,” the report said.
“Consumer spending varied as reports of stronger light vehicle sales were accompanied by somewhat softer readings in non-auto retail spending. Tourism and travel activity generally picked up. On balance, reports suggested that residential construction growth accelerated somewhat even as growth in home sales slowed, in part due to a lack of inventory.”
The report also indicated the labor market is tight, with low-skill positions having trouble being filled and higher-skilled positions seeing increased demand. “A couple of Districts reported that worker shortages and increased labor costs were restraining growth in some sectors, including manufacturing, transportation, and construction,” the report added.
Following this report, markets remained where they’ve been for most of the session, with equities mixed and the Dow lagging.
Another area we’ve been tracking in recent Beige Book is a bit more of a local concern, and that is rents in the New York City metro area.
The latest Beige Book indicated that the housing market in this region has improved of late, though New York City’s rental market remains weak, with landlord concessions — things like a free months’ rent, for example — still rising.
Here’s the full rundown:
Housing markets across the District have been mixed but, on balance a bit stronger since the last report, with ongoing slack at the high end of the market. New York City’s rental market has been steady to somewhat weaker. Landlord concessions have grown more prevalent in an effort to keep rents and vacancy rates steady. Effective rents (factoring in these concessions) have continued to decline–particularly on larger units and particularly in Manhattan. Elsewhere, rents continued to rise in northern New Jersey but were mostly flat across upstate New York.
New York City’s co-op and condo resale market has improved somewhat. Sales volume increased, while prices were mixed–rising in Brooklyn and Queens but slipping in Manhattan. Inventories have risen somewhat in Manhattan but remain low; properties have been taking longer to sell, and bidding wars have become less common. In Long Island, Westchester and Fairfield counties, home sales activity was increasingly robust, while prices were steady to up only modestly. In upstate New York, the market has continued to strengthen, with exceptionally low resale inventories boosting prices and bidding wars.
Update 1:20 p.m. ET
Stocks remain mixed in early afternoon trade, though the major U.S. indexes have lost some steam in the last 45 minutes or so.
The Dow is currently down about 75 points, the S&P 500 is roughly unchanged, the Nasdaq is up about 0.4%, off earlier highs.
The big loser on the Dow remains IBM, which is cleaving about 55 points off the index.
Update 12:28 p.m. ET
BlackRock (BLK) CEO Larry Fink is still worried about the U.S. economy.
“There are some warning signs that are getting darker,” Fink told Bloomberg TV on Wednesday. These comments largely echo what Fink told Yahoo Finance’s Andy Serwer at the Yahoo Finance All Markets Summit in February.
During that interview, Fink said, “I see a lot of dark shadows that could impact the direction of the marketplace.”
On Wednesday, Fink also expressed a cautious outlook on the U.S. stock market given the current lack of action we’re seeing from the Trump administration, notably on tax reform, which is seen as a potential boon for corporate profits.
“If we don’t have earnings validated in these higher P/Es we could adjust downward 5 or 10 percent from here,” Fink said. “If the administration does succeed on some of these items then the market will then reassert itself going higher.”
BlackRock shares were down about 1.5% on Wednesday after the asset management firm reported earnings per share that topped estimates while revenue came in below expectations.
Update 11:50 a.m. ET
In major media news only tangentially related to markets, New York Magazine’s Gabriel Sherman is reporting that Bill O’Reilly — the popular Fox News host of The O’Reilly Factor — will leave the network.
“The Murdochs have decided Bill O’Reilly’s 21-year run at Fox News will come to an end,” Sherman wrote.
“According to sources briefed on the discussions, network executives are preparing to announce O’Reilly’s departure before he returns from an Italian vacation on April 24. Now the big questions are how the exit will look and who will replace him.”
Fox News is owned by 21st Century Fox (FOXA), and Sherman adds that the board of 21st Century Fox is set to meet Thursday to discuss the issue.
O’Reilly recently signed a new multiyear contract with Fox worth more than $20 million per year, according to Sherman. O’Reilly is the highest-rated cable news host on the air.
Sherman reported Wednesday that the Murdochs, and notably Rupert’s sons James and Lachlan, had been arguing O’Reilly needed to go after recent sexual harassment allegations against the host had led to numerous advertisers pulling their support for the show.
Update, 11:30 a.m. ET
U.S. stock indexes are mixed on Wednesday after a see-saw opening two days of trading this week that saw markets rally hard on Monday before selling off on Tuesday.
Near 11:30 a.m. ET, the Dow was down 12 points, or 0.06%, the S&P 500 was up 7 points, or 0.3%, while the tech-heavy Nasdaq was a leader, rising 44 points, or 0.8%.
Shares of “Big Blue” were down as much as 5% on Wednesday, taking more than 55 points off the index, or more than all of the decline in the Dow overall.
This drop follows the more than 4% decline we saw from Dow member Goldman Sachs (GS) on Tuesday, which weighed on the index.
IBM’s drop also comes as the Nasdaq leads the market, with Facebook (FB) shares up more than 1% and Intel (INTC) rising nearly 1%. Biotechs are also outperforming on Wednesday, with the IBB ETF that tracks the sector rising 0.9%.
The economic calendar on Wednesday is light, with the main event set to come later this afternoon with the release of the Federal Reserve’s Beige Book report, which is a collection of economic anecdotes from across the country.
This release comes a little less than two weeks before the Fed’s next policy meeting, set for May 2-3.
The biggest economic story this morning, however, is recent data indicating that economic surprises are no longer as consistently positive as they’ve been since Donald Trump’s election. While not necessarily a sign of negative economic developments to come, the decrease in positive economic data certainly indicates that we are entering a new phase of the Trump economic era.
Myles Udland is a writer at Yahoo Finance. Follow him on Twitter @MylesUdland
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Crude oil is getting smoked, IBM shares tumble 5% – Yahoo Finance}