European markets are called to open negative this morning.
The dollar strengthened against the yen and euro, Asian stocks fell for the first time in three days while oil and metals led commodities lower after the Federal Reserve cut estimates for U.S. economic growth and didn’t signal further stimulus.
Asian stocks fell, driving the region’s key index lower for the first day in three, after the U.S. Federal Reserve lowered its growth forecast for the world’s biggest economy and amid concern China will raise interest rates.
Kyocera Corp., a maker of mobile phones and solar panels that gets more than 20 percent of its sales in the U.S., slid 1.5 percent in Tokyo. LG Electronics Inc., which gets 30 percent of its revenue in North America, fell 0.8 percent in Seoul. Aluminum Corp. of China Ltd. lost 1.9 percent in Hong Kong after the China Securities Journal said the government should raise interest rates. BHP Billiton Ltd., the world’s No. 1 mining company, sank 1 percent as oil and copper prices fell.
U.S. stocks fell Wednesday after the Federal Reserve issued a dour assessment of the economy but gave no indication that additional stimulus measures are in the works.
The Dow Jones industrial average fell 80 points, or 0.6%, to 12,109. The S&P 500 lost 8 points, or 0.6%, to 1,287. The Nasdaq Composite tumbled 18 points, or 0.7%, to 2,669.
Stocks had drifted between small gains and losses throughout the day before the selling picked up steam in the final hour of trading.
Shares of Boeing fell 2.5%, making it the worst performer on the Dow. But the selling was broad based, with only three stocks in the blue-chip index ending in the black.
In a widely expected move, the Fed held its benchmark interest rate near zero percent, saying the economic recovery has been weaker than expected.
Echoing past statements, the Fed said economic growth remains tepid enough to justify “exceptionally low” interest rates for an “extended period” of time.
“There was was no ‘new news’ in the Fed’ statement today,” said Nigel Gault, an economist IHS Global Insight
Events this week
Thursday – Investors will get weekly jobless claims from the Labor Department at 8:30 a.m. ET followed later by May new home sales from the Census Department at 10 a.m. ET.
Economists are looking for weekly claims to rise to 418,000 from last week’ 414,000 claims, while new home sales are expected to fall to 305,000 annualized units from April’ 323,000 annualized units.
Software giant Oracle will report its earnings after the market open on Thursday. Analysts expect Oracle to earn 71 cents a share. Investors will also get earnings from ConAgra Foods, H&R Block and homebuilder Lennar.
Friday – The Commerce Department will release its third reading on first-quarter gross domestic product at 8:30 a.m. ET, as well as May durable goods orders.
First quarter GDP is expected to remain steady at 1.8% growth according to economists’ estimates. Durable goods orders are expected to rise 1% compared with April’ 3.6% decline in orders.