Stock market news: October 30, 2019 – Yahoo Finance

Stock News

Posted on October 30, 2019

U.S. stocks were mixed Wednesday as investors digested an estimates-topping third-quarter gross domestic product report and awaited the latest monetary policy decision from the Federal Reserve.

Equities briefly sold off but then recovered after Chile said it was canceling the APEC summit set to take place next month due to protests, according to multiple media reports. That summit was poised to set the stage for a meeting between President Donald Trump and his Chinese counterpart Xi Jinping, as the two sides continue to work toward an at least partial trade agreement.

Here were the main moves in markets, as of 11:26 a.m. ET:

S&P 500 (^GSPC): -0.08%, or 2.4 points
Dow (^DJI): +0.09%, or 25.07 points
Nasdaq (^IXIC): -0.1%, or 8.53 points
WTI crude oil prices: (CL=F): -0.45% to $55.29 per barrel
10-year Treasury yield (^TNX): -3.9 bps to 1.796%
Gold (GC=F): +0.21% to $1,493.80 per ounce

The Bureau of Economic Analysis released its advance third-quarter GDP report at 8:30 a.m. ET, providing a snapshot on the health of the domestic economy during the July through September period. The results were better-than-expected, with a still-resilient consumer helping offset weakness in other areas of the economy.

Headline GDP rose at a seasonally adjusted annualized rate of 1.9% quarter-on-quarter, better than the 1.6% pace expected. This was still, however, a deceleration from the second quarter’s 2.0% pace.

Personal consumption grew 2.9% in the third-quarter, also topping expectations for 2.6% growth. While still a moderation from the second quarter’s 4.6% surge, the buoyancy of consumer spending still counterbalanced a second straight quarter of declines in business investments.

The vast majority of market pundits had expected the report would reflect a slowdown in U.S. economic activity amid weaker business investment trends and moderating consumer spending. Non-residential investment held in negative territory for a second straight quarter in the third quarter, falling 3.0%, or the most since late 2015.

Separately, a report from ADP/Moody’s showed U.S. businesses added 125,000 private payrolls in October, topping expectations for a gain of 110,000.

The BEA’s GDP report is one the last major pieces of economic data Federal Open Market Committee officials see before delivering their latest rate decision at 2 p.m. ET Wednesday. Investors have priced in with all but certainty that central bankers will cut benchmark interest rates by a quarter-point for a third consecutive time this year.

Traders work on the floor at the New York Stock Exchange (NYSE) in New York, U.S., October 18, 2019. REUTERS/Brendan McDermid

The Fed characterized the past two rate reductions as “insurance cuts,” or a means to encourage borrowing and lending and provide stimulus in the face of deteriorating economic data and lingering geopolitical risks. But after this expected rate cut, the central bank’s next move is much more opaque.

So far, markets have priced in an about 20% probability of a fourth rate cut in December – a relatively low percentage when compared to the high odds placed ahead of the past several cuts. At the conclusion of its September meeting, the Fed released its “dot plot” of projections for where rates were headed, showing that seven of the FOMC’s 17 participants saw at least one more quarter-point rate cut by the end of 2019.

While economic data releases Wednesday have pulled focus, corporate earnings season also continued to chug along.

Ahead of the opening bell, General Electric (GE) topped consensus expectations for quarterly sales and profit and boosted its guidance for closely watched industrial free cash flow for the year. The conglomerate, which is about a year into a turnaround plan led by CEO Larry Culp – said it expects as much as $2 billion in free cash flow this year, after previously projecting anywhere from negative to positive $1.0 billion.

Meanwhile, Airbus (AIR.PA) beat bottom-line expectations for the quarter, but the better-than-expected profit was overshadowed after the French plane-maker lowered full-year cash flow guidance. It said it expected to deliver about 20 fewer planes this year, as production challenges hit development of its A320neo aircraft, which competes directly with Boeing’s (BA) narrow-body jets.

Companies including Facebook (FB), Apple (AAPL) and newly public ride-share company Lyft (LYFT) are set to report quarterly results after market close Wednesday.