Dow edges to record as tech, energy shares retreat

The Federal Reserve is seen in Washington, DC on June 14, 2017.
The Federal Reserve is seen in Washington, DC on June 14, 2017.PHOTO: AFP

NEW YORK (AFP) – The Dow edged to a fresh record on Wednesday (June 14), but US stocks ended mostly lower after the Federal Reserve lifted interest rates and falling oil prices hit petroleum-linked equities.

The Fed, as expected, raised benchmark interest rates and signalled another increase was likely this year, despite a recent spate of weak economic data.

Energy shares came under pressure after US oil prices slid to their lowest level since July following a bearish US oil inventory report. Halliburton, ConocoPhillips and Devon all lost more than two percent.

The Dow Jones Industrial Average gained 0.2 per cent to 21,374.56, closing at a record for the second straight day.

The broad-based S&P 500 shed 0.1 per cent to 2,437.92, while the tech-rich Nasdaq Composite Index dropped 0.4 per cent to 6,194.89.

Art Hogan, chief market strategist at Wunderlich Securities, said the opposite movements of the Dow and Nasdaq suggested the market was resuming a rotation of investment away from highflying tech stocks, a trend that first surfaced late last week.

Apple lost 1 per cent, Microsoft 0.5 per cent and Amazon 0.4 per cent.

“On balance you got the continuation of technology stocks selling and the market accepting the Fed decision as consensus,” Hogan said.

Alexion Pharmaceuticals shot up 9.3 per cent after announcing that it hired Paul Clancy as chief financial officer. Biogen, where Clancy had been working, fell 3.1 per cent.

Toymaker Mattel dropped 2.2 per cent as it announced it was cutting its dividend by more than half to free up funds for new marketing and technology investments.