Stocks fall on Atlanta Fed cut to 4Q GDP forecast, weak economic data

By StocksFOXBusiness

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A&G Capital Research President Hilary Kramer on the outlook for Federal Reserve policy and the stocks to watch for investors.

Stocks fell Thursday after the Atlanta Federal Reserve cut its forecast for fourth-quarter gross domestic product (GDP) growth and the Census Bureau issued a disappointing durable goods report.

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The Atlanta Fed's GDPNow, which is a running estimate of real GDP growth, lowered its fourth-quarter GDP forecast Thursday to 1.4 percent growth from its Feb. 14 forecast of 1.5 percent. Originally, GDPNow forecast 2.7 percent GDP growth.

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"After this morning's advance durable manufacturing report from the U.S. Census Bureau, the nowcast of fourth-quarter real nonresidential equipment investment growth declined from 4.5 percent to 3.9 percent," the Atlanta Fed said in a statement.

The Philadelphia Federal Reserve said its gauge on business activity in the Mid-Atlantic region unexpectedly fell to the weakest level since May 2016.

The index dropped to reading of -4.1 from 17 in January. A reading below zero indicates contraction.

The Commerce Department reported that overall durable goods rose in December. However, a key component called nondefense capital goods, fell 0.7 percent from November, pointing to a further slowdown in business spending.

TickerSecurityLastChange%Chg
I:DJIDOW JONES AVERAGES26597.05-59.34-0.22%
SP500S&P 5002927.25-6.43-0.22%
I:COMPNASDAQ COMPOSITE INDEX8102.014611-18.81-0.23%

The National Association of Realtors said existing home sales unexpectedly fell 1.2 percent in January, marking a third straight month of declines.

The Labor Department reported initial claims for state unemployment benefits dropped 23,000 to a seasonally adjusted 216,000 last week.

Shares of Dow component Nike fell after Duke University forward Zion Williamson was injured in a game against North Carolina, when his foot slid on the floor and his Nike-made shoe came apart.

Shares of Domino’s Pizza plunged after the firm reported fourth-quarter earnings, revenue and same-store sales that missed expectations.

TickerSecurityLastChange%Chg
NKENIKE INC.88.39+0.96+1.10%
DPZDOMINOS PIZZA INC283.42+13.22+4.89%

Investors were also keeping an eye on possible advances in U.S.-China trade talks.

Negotiators may be close to coming up with a deal that will end the trade sanctions between the U.S. and China. It is considered the most significant progress yet toward ending a seven-month trade war, according to report from Reuters.

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Oil prices fell below 2019 highs on Thursday after U.S. government data showed a fifth weekly build in crude  inventories and record production. U.S. West Texas Intermediate crude oil futures fell 13 cents to $57.03 a barrel by 11:43 a.m.

In Asian markets on Thursday, China’s Shanghai Composite fell 0.34 percent, Hong Kong’s Hang Seng gained  0.41 percent and Japan’s Nikkei edged up 0.2 percent.

In Europe, major averages closed mixed. London’s FTSE dropped 0.9 percent, Germany’s DAX added 0.2 percent and France’s CAC was unchanged.