Stocks seesawed Wednesday after the Federal Reserve indicated there may be no further interest rate hikes this year. The Dow Jones Industrial Average (DJINDICES:^DJI) and the S&P 500 (SNPINDEX:^GSPC) jumped following the Fed announcement, but then fell back.
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The news from the Federal Reserve caused interest rates and the dollar to fall, hurting banks and boosting gold stocks. The SPDR S&P Regional Banking ETF (NYSEMKT:KRE) lost 3.4% and the VanEck Vectors Gold Miners ETF (NYSEMKT:GDX) rose 2.3%.
Google to launch cloud gaming platform
Google is jumping into the online video game market in a big way, launching an online video game platform that will stream high-definition video. The service, called Stadia, will launch later this year and work across desktops, laptops, TV, tablets, and phones, streaming 4K video at 60 frames per second with surround sound. Class C shares rose 2.1%.
Google is building specialized servers to support the service, using graphics chips supplied by Advanced Micro Devices, and will sell a Stadia game controller. The company will leverage its access to 200 million people watching gaming content on YouTube by having a "play now" button that launches the game without any downloads or installs.
The Alphabet unit had already revealed its intention to get into cloud-based gaming last year with a test of Ubisoft's Assassin's Creed Odyssey running in the Chrome browser. This latest announcement had observers speculating whether Google will usher in a new era of video gaming.
Slowing global trade hits FedEx
FedEx gave investors another reason to worry about a global economic slowdown after its fiscal third-quarter results missed expectations and the company lowered full-year guidance for the second straight quarter, sending shares down 3.5%. Revenue grew 3% to $17 billion and adjusted earnings per share fell 18.5% to $3.03. Analysts were projecting EPS of $3.11 on revenue of $17.7 billion.
Profit was impacted by costs to transition to a six-day working week, an investment in future growth from e-commerce. But the reason results didn't meet company expectations was largely due to slowing global trade. "Slowing international macroeconomic conditions and weaker global trade growth trends continue," said CFO Alan Graf in the press release. On the conference call, the company said that leading indicators suggest continued weakness in volumes to Europe and Asia.
CEO Fred Smith said that he is optimistic that conditions will be better in fiscal 2020, which begins June 1. But the outlook for the next few months looks challenging, leading FedEx to lower guidance for full-year adjusted EPS to $15.10 to $15.90, compared with the analyst consensus of $15.97.