Markets were set to open slightly lower Thursday morning following the possibility of a hike in interest Rates by the Fed early June; however much of the losses were cut by better than expected quarterly results from Cisco & Wal-Mart.
Wal-Mart shares (WMT.N) rose 8.3% to $68.40 in premarket trading after the reporting 1Q earnings results that were better than what analysts expected.
Cisco Systems on the other hand (CSCO.O) jumped 5.2% to $28.10 after the company reported its quarterly earnings that also beat expectations.
Global investment specialist at JP Morgan Private Bank in Atlanta, Georgia, Ed Hyland said, “One of the drags on the market has been the retailer and some of the names yesterday and today that have done well have tempered some of those concerns.”
The Dow Jones industrial average .DJI dropped 65.67 points, or 0.37%, to 17,460.95. The S&P 500 .SPX fell 8.28 points, or 0.4%, to 2,039.35. The Nasdaq composite .IXIC declined 22.67 points, or 0.48%, to 4,716.45.
On Wednesday, Wall Street lost much of the gains in volatile trading following the Fed’s assurance that inflation was increasing and were less bothered about a global economic slowdown. According to CME FedWatch tool, traders were projecting a 34% chance of the central bank hiking interest rates early June, up from 15%.
Ed Hyland added, “The potential for a June rate hike has put the market on edge a little bit, but we expect to see one in July and then another hike later in the year.”
The number of jobless Americans filing for unemployment benefit declined from a 14-month high last week, the latest signal that the economy was gathering momentum after staggering in the first quarter.
Oil prices fell more than 2%, declining for a second straight day following fears of a rate rise by the Fed, and as U.S. inventories reported an unprecedented increase.
Advance Auto Parts (AAP.N) fell 10.3% to $129.02 after the auto parts retailer cut its 2016/2017 comparable sales forecast.
Monsanto (MON.N) jumped 7.8% to $104.50 after unveiling information that German group Bayer has made a spontaneous takeover proposal.