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U.S. stocks flat amid energy rally, likely Fed interest rate hike

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Investing.com -

Investing.com -- U.S. stocks were relatively flat on Monday, as investors proceeded cautiously ahead of a likely interest rate hike by the Federal Reserve at the completion of its two-day meeting later this week.

The Federal Open Market Committee is widely expected to approve its first rate hike in nine years when it concludes its December monetary policy meeting on Wednesday. The Fed's benchmark Federal Funds Rate has remained at its current near-zero level for every meeting since December, 2008. On Monday, the CME Group's (O:CME) FedWatch placed the probability of a rate hike at 81.4%, up slightly from Friday's level of 79.4% at the close of trading. The tool, which is based on the CME Group's 30-day Fed Fund futures prices, is used to express the market's view on the likelihood of changes.

The Dow Jones Industrial Average gained 103.29 or 0.60% to 17,368.50, while the NASDAQ Composite index inched up by 18.76 or 0.38% to 4,952.23, after each suffering one of their worst weeks of the year last week. The S&P 500 Composite index, meanwhile, rose 9.57 or 0.48% to 2,021.94, as nine of 10 sectors closed in the green. Stocks in the Telecommunications, Energy and Consumer Goods industries led, while stocks in the Basic Materials sector lagged.

The top performer on the Dow was Chevron Corporation (N:CVX), which added 2.93 or 3.39% to 89.37. Earlier on Monday, U.S. crude futures rallied by more than 2% to close above $36 a barrel after slipping below $35 for the first time in six years. The worst performer was EI du Pont de Nemours and Company (N:DD), which fell 2.52 or 3.58% to 67.92, as investors continued to digest the chemical conglomerate's $130 billion merger with DOW late last week.

The biggest gainer on the NASDAQ was Electronic Arts Inc (O:EA), which rose 2.49 or 3.71% to 69.66, as the manufacturer of the Star Wars Battlefront video game looks to capitalize from the launch of the Star Wars movie later this week. The worst performer was Seagate Technology (O:STX), which fell 2.31 or 6.42% to 33.67, as analysts continue to question whether the hard-disk giant can sustain a hefty 7% dividend.

The top performer on the S&P 500 was First Solar Inc (O:FSLR), which surged 3.15 or 5.70% to 58.41 in spite of its relatively modest forward guidance projections. First Solar, the largest solar manufacturer in the U.S., also projected lower gross margin and slight revenue growth in its outlook for next year. The worst performer was Southwestern Energy Company (N:SWN), which fell 0.57 or 9.66% to 5.33. Southwestern Energy closed just below Newell Rubbermaid Inc (N:NWL), which lost 3.13 or 6.91% to 42.15. Investors reacted to Newell Rubbermaid (N:NWL)'s $16 billion acquisition of consumer goods company Jarden on Monday in a cash-and-stock deal that could lead to cost synergies of approximately $500 million over the next four years.

On the New York Stock Exchange, declining issues outnumbered advancing ones by a 2,285 to 826 margin.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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