U.S. stocks closed with modest losses on Wednesday, well off their intraday highs, after the Federal Reserve cut interest rates by 50 basis points, the high side of estimates for its first cut in more than four years.
Market Snapshot
The Dow Jones Industrial Average fell 103.08 points, or 0.25%, to 41,503.10, the S&P 500 lost 16.32 points, or 0.29%, to 5,618.26 and the Nasdaq Composite lost 54.76 points, or 0.31%, to 17,573.30.
Market Movers
Intuitive Machines, the provider of space technology, received acontract from NASA, potentially reaching about $4.82 billion over 10 years, to provide “communication and navigation services for missions in the near space region, which extends from Earth’s surface to beyond the Moon.” The stock soared 38%.
BlackRock has teamed with Microsoft and MGX, the Abu Dhabi-backed investment company, on anew artificial-intelligence fundthat aims to raise $30 billion to invest in new and expanded data centers and related energy infrastructure. BlackRock was up 2% and Microsoft declined 1%.
Super Micro Computer rose 0.6% to $436.88. Coverage was initiated with aBuy ratingand price target of $600 on shares of the server maker by analysts at Needham, who wrote in a research note they see the company “as a significant beneficiary from growing investment in AI infrastructure.” The analysts also forecast a compound annual growth rate for revenue of more than 55% from fiscal 2021 to fiscal 2026.
Blink Charging plans to reduce its global workforce by 14%, calling it a “proactive step to adapt to current market conditions while preserving our long-term strategy.” The electric-vehicle charging equipment provider anticipates annualized savings of about $9 million from the job cuts, which are expected to be completed in the first quarter of 2025. Shares fell 3.7%.
Tesla dipped 0.3% to $227.20. Shares of the electric-vehicle makerswung wildlyaround rate decisions from the Federal Reserve. Since 2019, Tesla stock has moved an average of about 2.5%, up or down, the day of the decision, according to Dow Jones Market Data.
Boeing rose 0.8% after CEO Kelly Ortberg said the airplane maker was “initiating temporary furloughsover the coming days that will impact a large number of U.S.-based executives, managers, and employees” as the company’s largest union remains on strike.
General Mills rose 0.7% after the maker of Cheerios cereal reportedfiscal first-quarter earningsdropped to $579.9 million, or $1.03 a share, from $673.5 million, or $1.14, a year earlier.
ResMed was down 5.1% after shares of the maker of CPAP and other sleep-apnea airway machines wasdowngraded to Underperformfrom Peer Perform at Wolfe Research.
VF was upgraded to Overweight from Equal Weight at Barclays. The owner of apparel brands including Timberland and North Face was up 3.9%.
Market News
Google offered to sell part of ad tech business, not enough for EU publishers, sources say
Alphabet's Google took a major step this year to end an EU antitrust investigation with an offer to sell its advertising marketplace AdX but European publishers rejected the proposal as insufficient, two people with direct knowledge of the matter said on Wednesday.
Google's lucrative ad tech business attracted EU regulatory scrutiny last year following a complaint from the European Publishers Council.
Trump on Fed's actions: 'It was a big cut'
Republican presidential candidate Donald Trump commented on the U.S. Federal Reserve's rate cut on Wednesday by saying "it was a big cut."
The Federal Reserve on Wednesday kicked off what is expected to be a series of interest rate cuts with an unusually large half-percentage-point reduction.
"To cut it by that much, assuming they're not just playing politics, the economy would be very bad," Trump told reporters.
