Equities rise with inflation data, earnings in focus; Alphabet drops
By Sinéad Carew and Lisa Pauline Mattackal
(Reuters) -Wall Street's three main stock indexes rose on Wednesday as investors digested Federal Reserve meeting minutes ahead of September inflation data and earnings reports, but Alphabet (NASDAQ:GOOGL ) shares fell on fears the U.S. would break up Google.
Stocks held steady after the release of the Fed's September meeting minutes showed a "substantial majority" of officials supported an outsized half-point rate cut. There was broader agreement that the move would not commit the Fed to any particular pace of cuts in the future.
After the news, traders were slightly less optimistic about an easing in November, pricing in a 76% chance of a 25-basis-point reduction in borrowing costs and a 24% probability the Fed keeps rates on hold, according to CME's FedWatch.
Shares in market heavyweight Alphabet were down 2.5% after the U.S. Department of Justice said it may ask a judge to force Google to divest parts of its business. These include its Chrome web browser and its Android operating system, to curtail its search monopoly.
"News about antitrust initiatives create worries about what that means for the technology sector broadly and specifically the most dominant players," said Daniel Morris, chief market strategist for asset management at BNP Paribas (OTC:BNPQY ).
Trading has been choppy this week, with investors adjusting rate-cut expectations after a surprisingly strong jobs report.
The market is awaiting the Consumer Price Index inflation report on Thursday and the third-quarter corporate earnings season, which kicks off in earnest with some of the biggest U.S. banks reporting on Friday.
BNP's Morris said this was likely helping investor sentiment along with a drop in oil prices, which had gained in five of the previous six trading days due to an escalating conflict in the Middle East.
"Lower oil prices and expectations for good news on inflation and looking forward to earnings season are all broadly supportive for equity prices," said Morris.
Investors were also monitoring the potential impact of Category 5 Hurricane Milton, due to make landfall in Florida on Wednesday.
As of 2:24 p.m. ET, the Dow Jones Industrial Average rose 327.20 points, or 0.78%, to 42,407.57. The S&P 500 gained 26.17 points, or 0.46%, at 5,777.30 and the Nasdaq Composite climbed 63.05 points, or 0.35%, to 18,245.96.
Most S&P 500 industry sectors rose, although rate-sensitive utilities and real estate fell along with the communications services index, which includes Alphabet.
Boeing (NYSE:BA ) fell 2.8% after talks between the company and its key manufacturing union broke down.
Among gainers, shares of Norwegian Cruise Line (NYSE:NCLH ) outperformed the broader market with a 10% gain after Citi upgraded its rating to "buy." Its peer Carnival (NYSE:CCL ) rose 7.4% while Royal Caribbean (NYSE:RCL ) Cruises was up 4.7%.
Shares of Arcadium Lithium soared 30.5% after Rio Tinto (NYSE:RIO ) said it would acquire the miner for $6.7 billion.
U.S.-listed shares of Chinese firms dropped as investors continued to question if China would announce new stimulus measures. Alibaba (NYSE:BABA ) Group fell 0.9% and PDD Holdings was off 1.6%.
Advancing issues outnumbered decliners by a 1.19-to-1 ratio on the NYSE where there were 278 new highs and 41 new lows.
On the Nasdaq, 2,075 stocks rose and 2,049 fell as advancing issues outnumbered decliners by a 1.01-to-1 ratio. The S&P 500 posted 47 new 52-week highs and two new lows while the Nasdaq Composite recorded 85 new highs and 113 new lows.
Source: Investing.com
