New York Stock Market Mixed Ahead of FOMC and Earnings Reports... Bitcoin Up 2% (Comprehensive)

[Image source=Reuters Yonhap News]

[Asia Economy New York=Correspondent Baek Jong-min] The New York stock market closed mixed and flat ahead of earnings announcements from major tech companies such as Google and Microsoft, as well as the Federal Reserve's Federal Open Market Committee (FOMC) meeting results. While corporate earnings were positive, concerns arose as U.S. Treasury yields showed signs of rising again.

On the 27th (local time), the Dow Jones Industrial Average rose 3.36 points (0.01%) to close at 33,984.93, the S&P 500 fell 0.90 points (0.02%) to 4,186.72, and the Nasdaq dropped 48.56 points (0.34%) to 14,090.22.

The market ended the day with little change amid cautious trading ahead of major earnings reports and the FOMC meeting results.

According to FactSet data, about one-third of the companies listed on the S&P 500 have reported earnings, with 88% of them beating expectations, yet the index is struggling to gain further upward momentum.

Despite strong corporate earnings, the already elevated valuations are being reflected in the index. According to FactSet, only 58% of companies that reported earnings showed gains on the day of their quarterly report.

Tesla, which reported earnings the day before, plunged 4.5%. The negative reaction was attributed to profits being driven by Bitcoin sales and carbon credits rather than vehicle sales. Tesla's decline also dragged down Chinese electric vehicle maker Nio's stock by 3%.

General Electric (GE) reported disappointing results, recording a net loss of $2.8 billion, closing down 0.6%.

Delivery company UPS saw its stock surge 10% after reporting first-quarter earnings that exceeded expectations.

GameStop, primarily bought by retail investors, rose 5% following the completion of a $550 million rights offering.

After the market closed, Google reported a 34% increase in revenue and showed a strong gain of over 3% in after-hours trading. Microsoft also beat earnings expectations, but its stock was down about 3%.

Besides individual corporate earnings, the upcoming FOMC meeting results could also trigger market volatility.

The Fed is expected to keep the benchmark interest rate unchanged and maintain its inflation tolerance policy after this meeting, but with the economy accelerating its recovery, attention is focused on whether there will be any hints about tapering asset purchases or raising interest rates.

On the day, the yield on the 10-year U.S. Treasury note rose from about 1.568% the previous day to 1.618%. Amid ongoing large-scale U.S. government investment plans, the rebound of Treasury yields into the 1.6% range, after previously falling, is interpreted as reflecting market unease.

The rise in yields was particularly notable after the 7-year U.S. Treasury auction. There are concerns that worsening investor sentiment toward U.S. Treasuries could lead to a sharp rise in yields similar to that seen in February.

Expectations that the Fed might taper its $120 billion monthly asset purchases also appeared to fuel the rise in yields.

According to a CNBC survey conducted that day, respondents expected the Fed to begin tapering asset purchases gradually in January next year and to raise the benchmark interest rate for the first time in December 2022.

Cryptocurrencies rose across the board. According to CoinMarketCap, Bitcoin was trading at $55,000, up 1.9% from 24 hours earlier.

Among altcoins, Ethereum, the second-largest by market capitalization, stood out with a 6% increase. Dogecoin rose 0.6%, trading at 37 cents.

This content was produced with the assistance of AI translation services.