Stock Market Today: Fed Holds Rates, Tech Stocks Tumble

In this article:

• Federal Reserve's Decision and Market Reaction
• Today's Notable Stock Movements
• Economic Indicators and Global Market Trends
• Looking Forward: What's Next for Investors
• AI Stock Picker (Premium)
• TL;DR
• Question & Answer
• Today's Stock Picks for 01.31.2024 – Members Only

Federal Reserve's Decision and Market Reaction

Today, the financial markets responded to the Federal Reserve's announcement to keep interest rates unchanged.

The decision and Chair Jerome Powell's remarks led to a notable downturn in major indices.

Dow Jones Industrial Average (DJIA) dipped 0.82%, while the S&P 500 (SPX) and Nasdaq Composite (NDX) slid 1.61% and 2.23%, respectively.

Powell's statement that a rate cut is unlikely in March further fueled the downward trend.

Today's Notable Stock Movements

• Alphabet (GOOGL): Plunged over 7.5% to $140.10, significantly impacting both the S&P 500 and Nasdaq. The drop followed its Q4 earnings report, showcasing disappointing ad revenue despite beating top and bottom line estimates.
  
  
• Microsoft (MSFT): The stock retreated by 2.7% to $397.58 despite outperforming fiscal second-quarter expectations. The cautious guidance for the current quarter influenced the stock's performance.
  
  
• Boeing (BA): Shares climbed more than 5% to $211.04 following quarterly results that beat analyst estimates on both the top and bottom lines.
  
  
• Advanced Micro Devices (AMD): The company's shares declined by 2.54% to $167.69 after it reported challenges in its Embedded and Gaming segments.
  
  
• Tesla (TSLA): Experienced a drop to $187.29, falling by 2.2%.
  
  
• Nvidia (NVDA): Shares dropped by 2%.
  
  
• Meta Platforms (META): Fell by 2.5%.
  
  
• Apple (AAPL): Closed lower by 1.9%.
  
  
• Amazon.com (AMZN): Lost 2.4%.
  
  
• Manhattan Associates (MANH): Gained over 8.39% to $242.56 on an upbeat Fiscal 2024 outlook.
  
  
• Qualcomm (QCOM): The company anticipates announcing its first quarter fiscal 2024 results, and investors will focus on its performance.
  
  
• Rockwell Automation (ROK): Cratered more than 17.56% to $253.28 after reporting worse-than-expected December-quarter results.
  
  
• Stryker (SYK): Up 6% to $335.48 following fourth-quarter earnings and sales that exceeded estimates.
  
  
• Novo Nordisk (NVO): Up more than 5% to a new high following higher-than-expected fourth-quarter profit and sales.
  
  
• Paramount Global (PARA): Up 6.7% to $14.59 following a reported buyout offer.
  
  
• Powell Industries (POWL): Skyrocketed 45.3% to $118.53 after topping December-quarter earnings and sales forecasts.
  
  
• Starbucks (SBUX): Reversed lower by 1.1% after reporting lower-than-expected fourth-quarter earnings and sales.
  
  
• Automated Data (ADP): Up 3% following higher-than-expected earnings and revenue for its fiscal second quarter.

Economic Indicators and Global Market Trends

The U.S. 10-year Treasury yield declined to 3.97%, indicating a shift in investor sentiment.

In the labor market, the Nonfarm Employment Change report showed a lower-than-expected increase in employment, while the Chicago PMI indicated a contraction in the manufacturing sector.

In energy news, the weekly Crude Oil Inventories report revealed an unexpected increase in inventories, suggesting weaker demand.

Looking Forward: What's Next for Investors

Investors should monitor upcoming economic reports closely, especially those related to inflation and the labor market.

The Federal Reserve's stance on interest rates will continue to play a pivotal role in market dynamics.

Additionally, monitoring global market trends, including movements in Asian and European indices, will provide insights into the broader financial picture.

Best,

Algo Adviser
algoadviser.ai

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Overall market sentiment today: Bearish

Bullish Cases:

• Boeing (BA): Shares climbed more than 5% after surpassing analyst estimates for the quarter, indicating strong performance and investor confidence.
  
  
• Stryker (SYK): The company's stock increased 6% following fourth-quarter earnings and sales that exceeded estimates, showcasing robust financial health.
  
  
• Boston Scientific (BSX): Up 3% to a record high after topping fourth-quarter sales and profit views, signaling strong market performance.
  
  
• Novo Nordisk (NVO): Up more than 5% to a new high following higher-than-expected fourth-quarter profit and sales.
  
  
• Paramount Global (PARA): Up 6.7% following a reported buyout offer, reflecting positive investor sentiment.
  
  
• Powell Industries (POWL): Skyrocketed 45.3% after topping December-quarter earnings and sales forecasts, indicating a bullish outlook for the company.
  
  
• Automated Data (ADP): Up 3% following higher-than-expected earnings and revenue for its fiscal second quarter.

Bearish Cases:

• Alphabet (GOOGL): Plunged over 7%, significantly impacting both the S&P 500 and Nasdaq, due to disappointing ad revenue in its Q4 earnings report.
  
  
• Microsoft (MSFT): Retreated by 2.7% despite outperforming fiscal second-quarter expectations, influenced by cautious guidance for the current quarter.
  
  
• Advanced Micro Devices (AMD): Shares declined by 6.5% after reporting challenges in its Embedded and Gaming segments.
  
  
• Tesla (TSLA): Fell by 2.2%, indicating negative investor sentiment.
  
  
• Nvidia (NVDA): Shares dropped by 2%.
  
  
• Meta Platforms (META): Fell by 2.5%.
  
  
• Apple (AAPL): Closed lower by 1.9%.
  
  
• Amazon.com (AMZN): Lost 2.4%.
  
  
• Rockwell Automation (ROK): Cratered more than 17% after reporting worse-than-expected December-quarter results.

Neutral Cases:

• Manhattan Associates (MANH): The stock gained over 13% on an upbeat Fiscal 2024 outlook, but the overall negative performance of other major tech stocks balances this.
  
  
• The Federal Reserve's decision to hold interest rates steady adds uncertainty. It indicates a cautious approach to monetary policy, which the market can interpret in multiple ways.

Conclusive Sentiment: Bearish

Based on the analysis, the overall sentiment leans towards Bearish. The significant declines in key tech stocks like Alphabet (GOOGL), Microsoft (MSFT), and others, combined with the Federal Reserve's cautious stance on interest rates, overshadow the positive performance of a few individual stocks. The general downturn in major indices like the DJIA, S&P 500, and Nasdaq Composite further reinforces the bearish sentiment.

Read more from these trusted sources:

• https://finance.yahoo.com/news/stock-market-today-stocks-sink-after-powell-suggests-fed-may-not-cut-rates-in-march-201123350.html
• https://www.cnbc.com/2024/01/30/stock-market-today-live-updates.html
• https://www.kiplinger.com/investing/stocks/stock-market-today-stocks-slump-after-alphabet-earnings-fed-meeting
• https://www.investors.com/market-trend/stock-market-today/stock-market-mixed-while-google-microsoft-drop/
• https://www.tipranks.com/news/stock-market-news-today-01-31-24-futures-mixed-as-markets-await-fed-meeting-results

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TL;DR:

Today's financial markets saw a bearish sentiment as major indices like the Dow Jones Industrial Average (DJIA), S&P 500 (SPX), and Nasdaq Composite (NDX) fell significantly following the Federal Reserve's decision to keep interest rates steady. Key tech stocks such as Alphabet (GOOGL) and Microsoft (MSFT) experienced notable declines, with Alphabet (GOOGL) plunging over 7% due to disappointing ad revenue and Microsoft (MSFT) retreating by 2.7% after issuing cautious guidance. On the brighter side, Boeing (BA) saw its shares climb more than 5% following strong quarterly results. The market's reaction reflects uncertainty and concern over the Fed's future monetary policy and the broader economic outlook.

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Q&A: