US stocks finish lower as investors await the Fed’s interest rate decision. The UK pound falls on Brexit concerns
- Theresa May, the UK’s prime minister, secured the passage of the bill allowing her to start Brexit negotiations. She will launch Article 50, starting the formal process of leaving the EU, by the end of this month. Ms May’s parliamentary victory was overshadowed by Scotland’s first minister’s call for a second referendum on independence. The pound was down 0.6 per cent against the dollar at $1.2148. The euro was 0.5 per cent weaker against the dollar at $1.0601. The single currency was 0.1 per cent firmer versus the pound at £0.8731. The greenback was down 0.1 per cent against the yen at Ұ114.77. The dollar index, a measure of the dollar’s value against a basket of six major rivals, was up 0.4 per cent at 101.76.
- Oil prices edged higher after Saudi Arabia, the world’s biggest oil exporter, asserted its commitment to OPEC’s cuts to stabilise the global oil market (late last year, OPEC members pledged to reduce their collective oil production to no more than 32.5 million barrels a day in the first half of this year). Brent, the international crude benchmark, was up 0.6 per cent at 51.68 dollars per barrel, while West Texas Intermediate, the US oil marker, settled at 48.50 dollars per barrel, up 0.2 per cent.
- The US Federal Reserve is widely expected to raise short-term interest rates by 25 basis points at the end of its meeting on Wednesday. The yield on the 2-year US Treasury note, which is particularly sensitive to changes in expectations for the Fed’s monetary policy, was up 1 basis point to 1.39 per cent, the highest since mid-2009. The 10-year Treasury yield fell 2 basis points to 2.60 per cent. The 10-year German Bund yield was down 2 basis points at 0.45 per cent. Yields and bond prices move in opposite directions.
- US stocks finished lower, with energy, industrial and materials shares led losses. The S&P 500 fell 0.3 per cent to 2,365.45. The Dow Jones Industrial Average closed 0.2 per cent lower at 20,837.37. The technology-focused Nasdaq Composite shed 0.3 per cent to 5,856.82. Small-cap companies faced greater pressures, with the Russell 2000 falling 0.6 per to 1,362.38.
- Elsewhere, Australia’s S&P/ASX 200 was little changed at 5,759.10. Hong Kong’s Hang Seng was flat. China’s Shanghai Composite rose 0.1 per cent to 3,239.33. The pan-European Stoxx 600 slipped 0.3 per cent to 373.46. The UK’s FTSE 100 finished 0.1 per cent lower at 7,357.85.
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