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World Market And Commodity News
Banking shares surge in NY on hawkish Fed minutes
Published :Friday, 20 May, 2016,  Time : 12:00 AM  View Count : 20
NEW YORK, May 18: US banking stocks surged Wednesday while the broader S&P 500 finished nearly unchanged as Federal Reserve meeting minutes boosted the odds for a June interest rate increase.
The record from the Fed's April policy meeting showed the central bankers keeping the door open to raising interest rates in June, pointing to stronger US growth in the second quarter.
"The Fed's goal is to send a message," said Gregori Volokhine, president of Meeschaert Financial Services.
"The Fed wants the market to take the possibility of a rate hike seriously."
The minutes propelled shares of large banks higher, as they stand to win higher profits if interest rates are hiked. JPMorgan Chase rose 3.9 per cent, while both Citigroup and Bank of America each rose by almost five per cent.
But the prospect of tighter money weighed on the rest of the market. The Dow Jones Industrial Average dipped less than 0.1 per cent to 17,526.62.
The broad-based S&P 500 rose less than 0.1 per cent to 2,047.63, while the tech-rich Nasdaq Composite Index climbed 0.5 per cent to 4,739.12.
Bigger gainers in the Nasdaq included Apple, which rose 1.1 per cent, and Tesla Motors, which climbed 3.2 per cent following an upgrade by Goldman Sachs.
Big-box retailer Target was one of the biggest losers, tumbling 7.6 per cent following a disappointing second-quarter forecast that showed the continued drag from a tough market for retailers.
Other large retailers were also in retreat, including Walmart, which fell 3.0 per cent, and Costco Wholesale, which lost 1.6 per cent. Walmart is scheduled to report earnings on Thursday.
Home-improvement retailer Lowe's rose 3.3 per cent as it reported first-quarter net income of $884 million, up 31.4 per cent from the year-ago period.

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