Stocks notch up new high but it's all about the Fed

Wall Street’s week ahead The Fed Trump at the U.N. and bitcoin

Wall Street’s week ahead The Fed Trump at the U.N. and bitcoin

September's meeting is key because the Federal Reserve is expected to announce plans to unwind its massive $4 trillion balance sheet - a formal process for tightening monetary policy. Banks benefit from higher bond yields because it means they can charge higher interest rates on loans. The stock was the biggest percentage loser on the S&P technology index.

Traders also sold off several packaged food companies after General Mills' latest quarterly results fell short of Wall Street's expectations.

Bond prices fell, sending yields higher.

Checking Fed Funds futures, they're now pricing in almost a 75% chance of one more rate hike this year vs. about a 50% chance ahead of today's Fed news.

The Australian dollar rose to $0.8016 from $0.8012. But other regional indexes wavered, with South Korea's Kospi slipping 0.2 percent to 2,406.50.

The pan-European STOXX 600 share index dipped less than 0.1 per cent. Australia's S&P/ASX 200 fell 0.7 percent to 5,668.90. The Bank of Japan left its monetary policy unchanged Thursday, signalling the central bank's confidence it will meet its 2 percent inflation target. Since December 2015, the Fed has modestly raised the rate four times.

Oil prices rose after Iraq's oil minister said Organization of the Petroleum Exporting Countries producers and others were considering extending a supply cut, and after data showed USA crude stocks were lower than expected.

There were no tectonic shifts in stock, bond or currency markets after the USA central bank said not only that it would begin trimming its $4.5-trillion portfolio of assets next month, but that it was sticking with plans to hike interest rates this year despite the markets' skepticism.

"We continue to expect that the ongoing strength of the economy will warrant gradual increases in that rate to sustain a healthy labor market and stabilize inflation around our 2 percent longer-run objective", Chair Janet Yellen said during a press conference. "Early movers in the region have so far been seen with mixed movements, mostly in red".

The higher dollar strained commodity markets, where the underlying raw materials are priced in the US currency.

Brent crude futures were up 0.3 percent at $55.30 a barrel and USA crude rose 0.6 percent to $49.76 a barrel. Hong Kong's Hang Seng index slipped 0.1 percent to 28,110.33 and the Shanghai Composite in mainland China lost 0.2 percent to 3,357.81.

The dollar was 0.4 percent higher at 112.610 yen after brushing 112.725, its highest since July 18. The euro strengthened to $1.2009 from $1.1996. "This puts a little pressure on gold", said Jeff Klearman, portfolio manager at GraniteShares, a provider and manager of exchange traded funds. Excluding food and energy, 12-month core CPI held steady at 1.7 percent, the same increase seen every month since May.

Mining and oil stocks outperformed, with Inpex Corp rising 2.3 per cent, Japan Petroleum Exploration Co gaining 0.8 per cent and Idemitsu Kosan added 2.1 per cent.

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