By Markus Heitkoetter
Stocks were lower today and the win streak in the NASDAQ came to an end.
Today’s economic reports included Crude Oil Inventories and New Home Sales. Crude Oil Inventories showed a surprise jump (9.4 million barrels in inventory versus a 2.5 million forecast), and New Home Sales came out inline with expectations.
Although Crude Oil (CL) dropped 3.9% today, it looks like the real weight on the markets had to do with St. Louis Fed President James Bullard and his comments pre-market.
In a Bloomberg interview, Bullard discussed the economy and said “you could probably make a case for moving (interest rates) in April.”
This was a BIG surprise for traders!
Just last week the Fed cut their targets and rate hike goals for 2016, and it seemed as though the potential for a rate hike anytime soon was unlikely. Now a voting Fed member says there is a case to raise rates next month!
Bullard’s comments added uncertainty to the markets, and by the end of the session the major indices were all lower. With today’s drop the S&P has erased its gains for 2016 and is back in negative territory for the year.
Here’s where the major indices ended the day:
The S&P finished with a 0.6% loss. Down 13 points, the S&P ended at 2,037.
The DOW ended 0.5% lower. Losing 80 points, the DOW closed at 17,503.
The NASDAQ decreased by 1.1%. With a 53 point drop, the NASDAQ finished at 4,769.
Fed Member Bullard also had an impact on the U.S. dollar. The dollar traded higher for the 4th consecutive day, and the Dollar Index (DX) was up another 0.4%.
Today’s strength in the dollar hurt metals. Gold (GC) finished down 2.0% at $1224.2 an ounce (the lowest since Feb), and Silver (SI) ended 3.9% lower at $15.26 an ounce.
Tomorrow the economic calendar includes FOMC Member Bullard speaking at 8:15am ET, Durable Goods data and Unemployment Claims at 8:30am ET