US Market Indexes Lower as Probability for Rate Hike Increases

Stocks trading lower with higher probability for a rate increase in September

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Sep 09, 2016
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U.S. market indexes were lower Friday. For the day, the Dow Jones Industrial Average closed at 18085.45 for a loss of -394.46 or -2.13%. The S&P 500 was also lower, closing at 2127.81 for a loss of -53.49 points or -2.45%. The Nasdaq Composite closed lower at 5125.91 for a loss of -133.57 points or -2.54%. The VIX Volatility Index increased to 17.16 for a gain of 4.65 points or 37.17%.

In the Dow Jones Industrial Average, the following stocks led losses:

Verizon (VZ, Financial) -3.32%

Caterpillar (CAT, Financial) -3.29%

Boeing (BA, Financial) -3.29%

Coca-Cola (KO, Financial) -3.12%

Intel (INTC, Financial) -2.74%

Apple (AAPL, Financial) -2.27%

The Baker Hughes Rig Count was the only report on the economic calendar Friday. The report showed an increase of eight oil rigs in North America for the week. Oil prices traded lower for the day with WTI crude oil falling to $45.62 per barrel. Brent crude oil was also lower at $47.80 per barrel.

Leading market indexes were lower for the week. The Dow Jones Industrial Average was down 2.18%. The S&P 500 was down 2.37%. The Nasdaq Composite was also lower with a loss of 2.33%

Comments from Federal Reserve officials on Friday strengthened the case for a rate increase in September, which caused market losses for the day. Federal Reserve officials and market economists report that a rate hike could happen in September, which is not a factor the U.S. market has been placing a high probability on. On Friday, stock prices reported significant losses as traders factored in a higher probability for a September rate increase. Treasury prices were also a factor as yields gained and investors traded stocks for credit investments.

A CNBC report Friday provided greater insight on the outlook for rate increases.

Disclosure: I do not own any stocks included in this article.

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