Wall St shuffled before Fed minutes; tech stocks weaken

The Wall Street sign is visible in front of the New York Stock Exchange (NYSE) in New York, United States on December 17, 2019. REUTERS / Brendan McDermid

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  • Salesforce.com falls as UBS pulls out
  • Beyond Meat Hops On Fake Fried Chicken Launch With KFC
  • Indices: Dow up 0.06%, S&P down 0.12%, Nasdaq down 0.55%

Jan. 5 (Reuters) – Major Wall Street indices were mixed on Wednesday ahead of the minutes of the Federal Reserve’s December meeting as investors traded tech stocks for cyclicals expected to benefit from a rate environment high interest.

Seven of S&P’s top 11 sectors rose early in the session with value-oriented stocks (.SPNY), financials (.SPSY) and materials (.SPLRCM) leading the pack.

Tech titans Apple Inc (AAPL.O), owner of Google, Alphabet Inc (GOOGL.O), Amazon.com, Meta Platforms (FB.O) and Microsoft Corp (MSFT.O) fell between 0, 4% and 1.2% to weigh the most on the S&P 500 and Nasdaq indices.

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Interest-rate-sensitive growth stocks have also come under pressure from a recent rise in U.S. Treasury yields, sparked by growing anxiety about the prospect of rising interest rates by the United States. Fed to curb inflation.

The US central bank announced last month that it would end its bond purchases during the pandemic in 2022, signaling at least three interest rate hikes for the year. Minutes of the meeting are expected at 1400 ET / 1900 GMT.

“With interest rates set to rise this year, it’s likely that tech stocks will end up feeling more pressure,” said Sam Stovall, chief investment strategist at CFRA Research in New York City.

“Investors would continue to move away from growth categories and move more to the value side of the equation.”

Salesforce.com Inc (CRM.N) fell 5.3% after UBS downgraded its stock rating to “neutral” instead of “buy”.

As of 10:14 a.m. ET, the Dow Jones Industrial Average (.DJI) was up 21.33 points, or 0.06%, to 36,820.98, the S&P 500 (.SPX) was down 5.97 points, or 0.12%, to 4,787.57, and the Nasdaq Composite (.IXIC) lost 85.91 points, or 0.55%, to 15,536.81.

ADP’s national employment report showed that private sector payrolls increased by 807,000 jobs last month, more than double what economists polled by Reuters had expected. Read more

The report precedes the Labor Department’s more comprehensive and closely watched employment data for December Friday.

Peloton Interactive (PTON.O) fell 0.5% after JP Morgan lowered its price target on the fitness company’s stock amid expectations of weaker demand.

AT&T Inc (TN) rose 2.5% after the US telecommunications company added 880,000 monthly pay phone subscribers in the fourth quarter. Read more

Beyond Meat jumped 4.6% after Yum Brands‘ KFC (YUM.N) announced it would start selling the vegan meat maker’s plant-based fried “chicken” across the United States for a limited time. Read more

Meanwhile, Citigroup analysts have said they now expect the S&P 500 Index to hit 5,100 by the end of 2022 on strong corporate earnings. Read more

Rising issues outnumbered declines by a 1.51-to-1 ratio on the NYSE and by a 1.04-to-1 ratio on the Nasdaq.

The S&P Index recorded 45 new 52-week highs and no new lows, while the Nasdaq recorded 50 new highs and 64 new lows.

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Reporting by Devik Jain and Shreyashi Sanyal in Bangalore; Editing by Maju Samuel

Our Standards: Thomson Reuters Trust Principles.

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