By Anora Mahmudova and Barbara Kollmeyer, MarketWatch
Durable-goods orders drop in February; Kraft, Kofex up on
M&A news
NEW YORK (MarketWatch) -- U.S. stocks drifted lower Wednesday,
declining for the third straight session as investors assessed
weaker-than-expected durable-goods orders and focused on the merger
between Kraft and Heinz.
The S&P 500 (SPX) was off by 3 points, or 0.2%, at 2,088,
with five of its 10 main sectors trading lower. The Dow Jones
Industrial Average (DJI) shed about 50 points, or 0.3%, falling to
17,962. The Nasdaq Composite (RIXF) fell the most 29 points, down
0.6%, at 4,967.89.
NYSE Composite volume on Tuesday was the fourth lowest this
year. Analysts at Credit Suisse said Tuesday's volumes were 2%
below Monday's dismal level.
Dan Greenhaus, chief global strategist at BTIG, said the market
is still digesting economic reports news in the wake of a Federal
Reserve that said it would be "data dependent" in determining the
pace of its first rate hike in nine years.
"Investors are waiting for the jobs report due next Friday and
seem to have been giving a pass to fairly poor data over the past
month. Today's durable-goods orders were in line with poor data of
late, which suggest that the first-quarter GDP will be weak,"
Greenhaus said.
Orders for durable U.S. goods
(http://www.marketwatch.com/story/february-durable-goods-orders-drop-14-in-weak-report-all-around-2015-03-25)
fell in February, suggesting businesses remain reluctant to invest
more aggressively, however market reaction to the release was
muted.
Charles Evans, president of the Chicago Federal Reserve,
speaking to press after a speech in London, warned that global
uncertainty is the biggest risk to the U.S. economy, advocating
interest rates stay low until 2016.
Sleeping giant: Tuesday's CPI data did help the dollar to
stabilize, which in turn weighed on stocks. Stan Shamu, market
strategist at IG, said many are waiting to see how long the dollar
can "remain at bay before resuming its run."
"It's almost as if the U.S. dollar is a sleeping giant at the
moment, and we probably won't be seeing much volatility in equities
either until it awakes," said Shamu in a note.
The dollar (DXY) shifted slightly lower Wednesday after data
showed German business confidence rose in March
(http://www.marketwatch.com/story/ifo-german-business-confidence-rises-again-2015-03-25)
for the fifth straight month, hitting its highest level since July
2014.
Stocks to Watch: Shares of Kraft Foods Group Inc.(KRFT) surged
35% in thin premarket activity after a merger was announced with
H.J. Heinz Company
(http://www.marketwatch.com/story/kraft-and-heinz-to-merge-in-deal-to-create-company-with-revenue-of-28-billion-2015-03-25).
Shares of Kofax Ltd.(KFX) were up 46% in premarket after the
software company agreed to be acquired by Lexmark International
(LXK) late Tuesday.
Earnings from Red Hat Inc.(RHT)Apollo Education(APOL), PVH
Corp.(PVH) and Paychex Inc.(PAYX) are expected on Wednesday.
Other markets: European stocks edged lower. In Asia, the
Shanghai Composite Index snapped a 10-day winning streak, and the
Japan Nikkei 225 index edged up 0.2%.
Oil prices (CLK5) were higher ahead of crude-stockpile data from
the U.S. Energy Information Administration due later. Late Tuesday,
the American Petroleum Institute, an industry group, said its data
for last week showed a 4.8-million-barrel gain in crude-oil
supplies. Gold prices (GCK5) were moderately higher.
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