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US STOCKS-Wall St slightly down a day after Fed raises rates
December 17, 2015 / 2:55 PM / 2 years ago

US STOCKS-Wall St slightly down a day after Fed raises rates

* Pandora soars after comments on new music royalties

* FedEx rises after Q3 profit beats view

* Jobless claims fall to 271,000

* Dow down 0.01 pct, S&P down 0.12 pct, Nasdaq up 0.16 pct (Updates to open)

By Abhiram Nandakumar

Dec 17 (Reuters) - U.S. stocks were down slightly in early trading on Thursday, a day after the Federal Reserve raised interest rates for the first time in almost a decade.

The central bank raised its benchmark rate by 25 basis points to between 0.25 percent and 0.50 percent, signaling confidence in the strength of the world’s largest economy.

Global stocks surged after Fed Chair Janet Yellen’s assurance that further tightening would be gradual and heavily dependent on inflation, which remained firmly below the central bank’s 2 percent target.

“The Fed really delivered exactly what the market wanted,” said Keith Lerner, chief market strategist at SunTrust Bank in Atlanta, Georgia.

“As far as today, we are seeing some follow through from all that positive (reaction),” Lerner said.

At 9:40 a.m. ET (1440 GMT), the Dow Jones industrial average was down 1.27 points, or 0.01 percent, at 17,747.82, the S&P 500 was down 2.48 points, or 0.12 percent, at 2,070.59 and the Nasdaq Composite index was up 8.22 points, or 0.16 percent, at 5,079.35.

Eight of the 10 major S&P sectors were lower, with the consumer staples sector’s 0.7 percent rise leading the decliners.

Investors will now keep a weather eye on data to gauge the economy’s capacity to withstand higher rates.

Data showed jobless claims fell to 271,000 last week, below 275,000 estimated, while third-quarter current account deficit expanded to $124.1 billion, the largest shortfall since the fourth quarter of 2008.

General Mills shares were down 2.8 percent at $57.59 after quarterly sales missed estimates.

Oracle was down 2.8 percent at $37.82 after its third-quarter profit forecast failed to impress investors.

Pandora was up 17.2 percent at $15.75 after the media-streaming company said new music royalty rates were “balanced”.

Fedex was up 4.5 percent at $155.42 after it reported a better-than-expected quarterly profit.

Avon was up 11 percent at $4.53 after the company said it would sell 80 percent of its North America business for $170 million. {nL3N1463YV]

Advancing issues outnumbered decliners on the NYSE by 1,369 to 1,321. On the Nasdaq, 1,427 issues rose and 841 fell.

The S&P 500 index showed seven new 52-week highs and one new low, while the Nasdaq recorded 23 new highs and 25 new lows. (Reporting by Abhiram Nandakumar and Aastha Agnihotri in Bengaluru; Editing by Anil D‘Silva)

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