After Market: Fed Eyes Higher Interest Rates, Investors Head for the Door

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It was a down day on Wall Street Wednesday as the Nasdaq snapped its longest winning streak in eight months.

Last week, Federal Reserve Chair Janet Yellen sparked the best one-day gain this year when she testified on Capitol Hill. But the Fed minutes of its most recent meeting weren't as well received, as policymakers discussed raising interest rates.

The Dow Jones industrial average (^DJI) gave back early gains to end 90 points lower, the Standard & Poor's 500 index (^GPSC) fell 12, and the Nasdaq composite (^IXIC) lost 35 points, ending that 8-day winning streak.

Board Of Governors Of Federal Reserve System Hold Open Meeting
Federal Reserve Chair Janet Yellen Alex Wong/Getty Images
Many of the big name Nasdaq stocks retreated. Apple (AAPL) and Amazon (AMZN) both fell about 1.5 percent. Netflix (NFLX) fell 2 percent. Its download speed in primetime slowed significantly last month, apparently because of a dispute it's having with Verizon (VZ). Twitter (TWTR) lost nearly 5 percent but Facebook (FB) gained another 1 percent.

Energy stocks were strong as crude oil and natural gas prices continued to rally. Natural gas prices are at their highest level since late 2008. Chevron (CVX) rose nearly 1 percent. The oil-drilling company Nabors Industries (NBR) jumped 13 percent after posting strong earnings.

Elsewhere, the jewelry chain Zale (ZLC) soared 40 percent after agreeing to be acquired by rival Signet Jewelers (SIG), which jumped 18 percent. Eli Lilly (LLY) gained 5 percent. It reported higher survival rates in a key clinical trial of its lung cancer treatment.

But U.S. Steel (X) dropped 7 percent as the Commerce Department said it will not impose tariffs on steel rods made in South Korea.

GPS maker Garmin (GRMN) gained 9 percent on better-than-expected numbers.
Columbia Sportswear (COLM) rose 7 percent. It reports strong sales momentum. Not surprisingly, its outerwear is in demand this winter. And Panera Bread (PNRA) gained 3.5 percent.

But the restaurant chain Potbelly (PBPB) had some indigestion, losing 9 percent after posting a loss. The stock doubled in price on its first day of trading last October, but since then, it has lost a third of its value.

Herbalife (HLF), the controversial nutrition supplement company, fell 4 percent despite an upbeat earnings report.

What to Watch Thursday:
  • At 8:30 a.m. Eastern time, the Labor Department releases weekly jobless claims and January's Consumer Price Index.
  • At 10 a.m., Freddie Mac releases its latest survey of mortgage rates, and the Conference Board releases leading indicators for January.
These major companies are schedules to release quarterly financial statements:
  • Express-Scripts Holding (ESRX)
  • Groupon (GRPN)
  • Hewlett-Packard (HPQ)
  • Hormel Foods (HRL)
  • Imax (IMAX)
  • Intuit (INTU)
  • Newmont Mining (NEM)
  • Nordstrom (JWN)
  • Priceline.com (PCLN)
  • Walmart Stores (WMT)
-Produced by Drew Trachtenberg.


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13 Comments

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toosmart4u

Higher interest rates would benefit all senior citizens. For over a trillion dollars bush jr. took out of social security and replaced the cash with treasury notes that pays very little interest. This would strengthen the social security trust fund for the future.

February 20 2014 at 4:07 AM Report abuse -1 rate up rate down Reply
joper201

I'm a senior who could live a lot better if the Interest rates were raised.
SS doesn't go very far.
If Interests rates were even 5% myself and others Seniors would be much better off.

Welfare recipients have seen about a 30% greater increase in their welfare than SS recipients have seen in the last 4 years.

February 20 2014 at 1:49 AM Report abuse rate up rate down Reply
Iselin007

Interest rates rising? They must be joking people can't handle any more costs! And I heard that their going to export milk which will drive milk prices up here!

What is the deal they export our jobs wages drop here but they export milk prices go up?

Cows are not the only ones being milked here!

February 20 2014 at 1:16 AM Report abuse rate up rate down Reply
crimeslawyer

Bring back the 5% CD rate. We have missed you.

February 19 2014 at 11:18 PM Report abuse +5 rate up rate down Reply
jwmgrand

Yellen is not going to drink the kool aid ....... all these fat securities ... will have to stand on their own ...... and actually PROVE they make $$$$$$ ........ the violent weaning begins ........ expect the NYSE floor to be carpeted in sell orders ...... Apple cant handle the big lift by itself .... and we are running out of Cinderella stocks .........

February 19 2014 at 11:14 PM Report abuse -2 rate up rate down Reply
NJPACKFAN

Just imagine how difficult higher interest rates will make it for world governments to pay the interest alone on the huge world debts.....$57,418,718,527,016.

February 19 2014 at 10:14 PM Report abuse rate up rate down Reply
1 reply to NJPACKFAN's comment
Big John

Just imagine how difficult it has been the last six years for savers and retired people who have made nothing on their savings. Maybe they will quit going in debt if they have to pay interest on it. Wall Street and the Banks have had their hay day the last six years on free money. It's time for the rest of the 95% to get a break.

February 19 2014 at 10:22 PM Report abuse +4 rate up rate down Reply
veedubbus69

why dont you just jump out the window and get it over with!

February 19 2014 at 9:33 PM Report abuse +2 rate up rate down Reply
1 reply to veedubbus69's comment
betty_brock

You first.

February 19 2014 at 9:40 PM Report abuse rate up rate down Reply
kenbushway

As a new investor I went the penny stock route. I need money to build a truly diversified money making porfolio, problem is I started out with just 300. Now I hate seeing my stock go down and since its a penny stock, its all it does. However I do take pleasure in the fact penny stocks don't swing as much with this kind of news as regular stocks sold on the NASDAQ would.

February 19 2014 at 9:24 PM Report abuse rate up rate down Reply
bigwave48

Yahooo,, us old buggers, now can live high on the hog.. high interest rates, mean larger
returns on our investments..

February 19 2014 at 9:07 PM Report abuse +3 rate up rate down Reply
betty_brock

The crash could come at any time.

February 19 2014 at 8:00 PM Report abuse -1 rate up rate down Reply