Category: Stock Market News

Federal Reserve officials said Wednesday they have agreed on details of a plan to shrink their $4.5 trillion balance sheet “this year.” At the moment the Fed maintains the balance sheet by reinvesting the proceeds of maturing Treasury bonds and mortgage-backed securities. Under the plan, the Fed will initially allow $6 billion per month in principal from maturing Treasury securities to run-off. This will increase in steps of $6 billion each quarter over a year until it reaches $30 billion per month. For mortgage-backed securities and agency debt, the Fed set an initial cap of $4 billion. This will increase in quarterly steps of $4 billion each quarter until it reaches $20 billion per month. The Fed did not set out how much it planned to shrink the balance sheet, saying they expect to learn more as the process goes along. If the economy slows, the central bank said it could resume reinvestment of all of the principal payments or even increase the size of the balance sheet if warranted. Carl Tannenbaum, chief economist at Northern Trust, said before the meeting that any agreement of such details would be a signal the Fed was prepared to start to shrink the balance sheet as soon as their September meeting.

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Several people have been injured and taken to the hospital following a shooting at a UPS facility in San Francisco’s Potrero Hill area early Wednesday, according to local reports. Initial reports indicate three people, including the shooter, are being treated for injuries. A UPS employee told the San Francisco Chronicle that he heard shots around 9 a.m. Pacific time and ran out with his colleagues. The streets around the building have been cordoned off and residents told to shelter in place.

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Sen. Bernie Sanders said Wednesday he was “sickened” to learn the suspected shooter at a congressional baseball game had apparently volunteered for his presidential campaign. “I am sickened by this despicable act,” said Sanders, who competed against Hillary Clinton for the Democratic presidential nomination. President Donald Trump said earlier Wednesday that the suspect in the shooting has died after being shot by police officers. Reports identified the suspect as James T. Hodgkinson of Belleville, Ill. Sanders said he condemned the action “in the strongest possible terms.”

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The 2-year Treasury yield tumbled 7.7 basis points to 1.290%, putting it on track for the largest one-day fall in yields since June 24, 2016, the day after the U.K. voted to exit from the European Union, according to WSJ Market Data Group. The 2-year Treasury note, which is especially sensitive to shifts in expectations for Federal Reserve interest-rate policy, headlined a broad rally in U.S. government bonds, pushing yields to their lowest levels since November, after a batch of inflation reports suggested that inflation may not be on pace to rise to the Fed’s target 2% rate. Consumer-price inflation, or cost of living, slowed to 1.9% in May from 2.2% in April, while the core index, which strips out volatile energy and food prices, rose 0.1% in May. Compared with a year ago, core CPI was up 1.7%, the lowest in 2 years. Retail sales fell 0.3% in May, the weakest in 16 months. Lower inflation is bullish for bonds, because a rise in inflation can erode the value of bond’s fixed interest payments. Yields on the 10-year and the 30-year Treasury bond were on track to fall the most in about a month. The yield moves come as the Fed is slated to deliver its updated policy statement, with expectations that the central bank will lift interest-rates by a quarter-point. The day after so-called Brexit, the two-year yield plunged 12.9 basis points. Bond trading action also comes after House Majority Whip Steve Scalise and others were shot Wednesday morning during a baseball-team practice for Republican members of Congress in Northern Virginia.

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President Donald Trump said Wednesday that the assailant in the shooting at a congressional baseball practice has now died from his injuries. House Majority Whip Steve Scalise was among those shot in the incident. The shooter has been identified in reports as James T. Hodgkinson of Belleville, Ill. Trump called for the country to come together in the wake of the shooting, saying “we are strongest when we are unified” and working for the common good.

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CHICAGO (MarketWatch) — James T. Hodgkinson, a 66-year-old man from Belleville, Ill., near St. Louis, has been named as the suspect in a shooting spree early Wednesday at a congressional baseball team’s practice session at an Alexandria, Va., park, according to numerous reports. The suspect, who is reportedly among five injured in the incident, runs a home-inspection business, according to the Washington Post. Hodgkinson is reportedly in custody. House Majority Whip Steve Scalise of Louisiana was said to have been shot in the hip and to be undergoing surgery. The shooter opened fire, reportedly with a rifle, as the Republican team was practicing for the annual Congressional Baseball Game, a charity event that raises funds for local charities.

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A popular fund tracking the energy sector on Wednesday was on pace for its steepest one-day slide in more than three months after crude-oil futures sank on the heels of a report showing a smaller-than-expected drop in U.S. inventories. The Energy Select Sector SPDR ETF was down 2.3%, which would mark the worst daily drop for the exchange-traded fund, if it holds, since March 8 when it fell 2.6%, according to FactSet data. All of the ETF’s components were trading in the red, led by a 6.2% decline in shares of Transocean Ltd. and a 5.1% fall in Murphy Oil Corp. . The moves come as the inventory report, released Wednesday at 10:30 a.m. Eastern, drove crude-oil futures for July delivery sharply lower. Data from the U.S. Energy Information Administration showed that domestic-crude supplies fell by 1.7 million barrels for the week ended June 9. Analysts at Citi Futures expected a decline of between 2 million and 3 million barrels. The broader market also was under pressure, with the Dow Jones Industrial Average was off 0.1%, the S&P 500 index was trading down 0.2%, while the Nasdaq Composite Index was off 0.1%. Crude futures have been dogged by persistent concerns about a glut of oil, despite recent efforts led by members of the Organization of the Petroleum Exporting Countries to curb output by extending a six-month output limit that would have ended this month until March 2018. U.S. shale producers, who are not party to the production limits, have been often cited as the biggest headwind to these global output agreements.

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A driver who previously drove for ride-hailing platform Juno has filed suit against the company this month on behalf of the drivers, saying they were promised equity in the company which they did not receive. New York-based Juno was acquired by ride-hailing competitor Gett in April for $200 million, and the suit says the drivers’ either received nothing for the shares or received a fraction of what they were owed. The suit, filed by lead plaintiff Mohammed Razzak, a former driver, is levied against Juno, its chief executive Talmon Marco, Vulvan Cars LLC and Gett. He alleges that Juno also miscalculated commissions on drivers’ fares, an issue Uber recently acknowledged. The suit asks for class certification, compensation and punitive damages for the drivers based on breach of contract, fraudulent misrepresentation and other criteria.

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Oil prices extended earlier losses Wednesday after data from the U.S. Energy Information Administration showed that domestic crude supplies fell by 1.7 million barrels for the week ended June 9. Analysts at Citi Futures expected a decline of between 2 million and 3 million barrels, but the American Petroleum Institute late Tuesday reported a climb of 2.8 million barrels, according to sources. Gasoline stockpiles rose 2.1 million barrels, while distillate stockpiles edged up by 300,000 barrels last week, according to the EIA. July crude fell 68 cents, or 1.5%, to $45.78 a barrel on the New York Mercantile Exchange. It traded at $46.13 before the supply data.

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Wunderlich analysts raised their price target on Hortonworks Inc. to $18 from $15 Wednesday after the company expanded its partnership with International Business Machines Corp. on machine learning. The partnership will extend machine learning capabilities to more designers using Apache Hadoop, the software used by Hortonworks. This should strengthen its competitive position against Cloudera Inc. , which recently went public. Additionally, the analysts say the fact that HortonWorks remains 100% open-source gives it an edge over the competition in terms of partnerships. The analysts estimate that Hortonworks will have revenue of at least $20 million in 2018. They reiterated a buy rating on the stock. Shares of Hortonworks were falling 2% Wednesday morning. Shares of Hortonworks have gained 40% in the past three months, compared to the S&P 500’s gain of 3%.

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