(ABM FN-Dow Jones) US stocks closed lower on Wednesday.
The leading S&P 500 index fell 2.1 percent to 3,748.59 points, the Dow Jones lost 2.0 percent to 32,513.94 points and the Nasdaq closed 2.5 percent lower at 10,353.17 points.
US stock markets were lower as investors awaited midterm election results to see if Republicans would take control of both houses of Congress. So far, Republicans appear to be headed for a majority in the House of Representatives, while the two parties in the Senate appear to be tied so far.
The S&P 500 closed up 2.9 percent in the past three sessions, partly on hopes that a Republican gain will break a partisan stalemate in Washington.
Wall Street expects this to be beneficial to stock valuations as it could reduce regulatory uncertainty, reduce the likelihood of more corporate taxes and reduce government spending, which should help curb inflation.
In addition, weaker inflation may reduce the need for the Fed to aggressively raise interest rates.
“What is clear … is that neither side will win the election with a sledgehammer, and it appears that the Republicans are still on track to gain a majority in the House of Representatives, which would put a brake on any new fiscal stimulus in the coming years,” Deutsche Bank said
On a macroeconomic level, it was announced on Wednesday that the number of mortgage loan applications in the US fell by 0.1 percent last week. The market index fell from 200.1 to 199.9.
US wholesale inventories rose 0.6 percent month-on-month in September, which was less than the 0.8 percent the market expected. On an annual basis, there was an increase of 24.1 percent.
Euro/dollar trades at 1.0011. At the start of the trading day in New York, the currency pair was still moving at 1.0020 and around the close of the American stock exchanges on Tuesday, there was a position of 1.0072 on the plates.
December futures for a barrel of West Texas Intermediate crude closed 3.5 percent, or $3.08, lower at $85.83 on the New York Mercantile Exchange on Wednesday, after the latest data from the U.S. Energy Agency EIA showed that U.S. crude inventories rose last week.
Two publications are on the agenda in the US on a macroeconomic level on Thursday. The weekly support requests and inflation dates for October will be published before the market closes.
Disney will spend less on marketing and content, after a disappointing third-quarter profit. Disney saw growth at Disney+ continue. The streaming service has now surpassed Netflix in the number of paying subscribers, but it had to invest heavily, including in the Star Wars and Marvel franchises. The share fell by more than 13.0 per cent.
Meta, the parent company of Facebook, Instagram and Whatsapp, is going to lay off 13 percent of its employees. 11,000 people have to leave. CEO Zuckerberg says in an open letter that he expected the growth in e-commerce and the strong revenue growth for Facebook to continue after the corona crisis. That turned out not to be the case, and high inflation is pushing advertising revenue down even further. Therefore, we now have to make significant cuts. The stock rose around 5.0 per cent.
Bed Bath & Beyond will issue stock to reduce its debt by $31.5 million. The stock was more than 10.0 percent lower.
Automated Data Processing raises its dividend by 20 percent from $1.04 to $1.25 per share. The stock fell around 2.0 per cent.
Cryptocurrencies were under pressure after Binance announced it would take over rival FTX, which ran into liquidity problems. Bitcoin fell 13.1 percent in price to $16,267. On Tuesday, the digital currency was already 9 percent cheaper. Ether also became 20 percent cheaper in a few days.
Crypto exchange Coinbase, listed on the Nasdaq, fell almost 10.0 percent, after a price loss of almost 11 percent on Tuesday.
Beyond Meat and Rivian publish their quarterly figures after the fair.
Source: ABM Financial News
From Beursplein 5, the editors of ABM Financial News closely follow developments on the stock exchanges, and in particular the Amsterdam Stock Exchange. The information in this column is not intended as professional investment advice or as a recommendation to make certain investments.