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The market is just no fun these days. Stocks have pretty much been sitting on their hands during this strong earnings season and failed to move higher again today after the Fed kept interest rates unchanged.
The major indices hung right below breakeven for most of the session, before taking a stiff move lower in the final hour or so. The Dow did manage a trek onto the positive side momentarily today, but ultimately finished lower by 0.72% (or about 174 points) to 23,925. The S&P took an almost identical trajectory and even slipped by 0.72% as well, finishing at 2635.7.
While the NASDAQ had the tamest pullback, it could also be considered the most disappointing. Shares of Apple advanced by 4.4% in response to its solid quarter announced after the bell yesterday, which included in-line iPhone sales and better-than-expected earnings. The index spent more time in the green than its counterparts, but even Apple couldn’t keep it there by the closing bell. It finished lower by 0.42% to 7100.9.
The Fed left rates alone as was widely expected, but the market seemed a bit concerned that inflation was moving closer to 2%. While that is considered a healthy level for inflation, investors are worried that it will lead to more rate hikes moving forward.
“Tomorrow could be very interesting. Will we gap down and break the 200-day? Or will we rally back to today’s higher. The day after the Fed can often be the start of a longer-term direction, so we should really pay attention the next two days into the weekend,”said Jeremy in Counterstrike.
Today's Portfolio Highlights:
Blockchain Innovators:Last week, Dave mentioned that Sony (SNE) filed a patent for a blockchain-based digital rights management system, which would cover a broad range of content from movies and TV to scientific and medical data. The editor believes this is only the beginning of its blockchain utilization. Since Taiwan Semiconductor continues to come under pressure, Dave decided to sell that Zacks Rank #4 (Sell) stock and add SNE in its place. Read more in the full write up.
Momentum Trader:The non-farm payroll result on Friday may provide a great opportunity for this portfolio to make a move or two. But first, Dave wanted to clear some room. The editor sold a couple of stocks today that he considers to be “duds”. However, one of those names proved to be a double-digit winner. The momentum in Paycom (PAYC) has pretty much dried up, so the remaining half was sold for a profit of about 14.5% in less than three months. Dave sold the first half on April 11 for a more than 23% return.