By Anora Mahmudova and Barbara Kollmeyer, MarketWatch
NEW YORK (MarketWatch) -- The U.S. stock market managed a modest
rally on Wednesday, a day after a bout of heavy selling drove the
main benchmark down nearly 4% from its peak reached just last
month.
The release of Federal Open Market Committee minutes due at 2
p.m. Eastern Time may provide direction to the markets, but some
strategists believe not much will be revealed as the Fed has
already been relatively transparent about its monetary policy
intentions. Split between hawks, doves to be evident in Fed
minutes
Investors appear reluctant to make big bets ahead of earnings
season, which Alcoa unofficially kicks off after the market close.
What to expect from Alcoa's earnings
The S&P 500 (SPX) was up 4 points, or 0.2%, at 1,939.14. The
Dow Jones Industrial Average (DJI) added 25 points, or 0.1%, to
16,742.99. The Nasdaq Composite (RIXF) gained 10 points, or 0.2%,
to 4,394.55.
As part of Tuesday's carnage, the S&P 500 (SPX) dropped 1.5%
to close at 1,935.1, and the Dow industrials (DJI) had the worst
day of selling in more than two months. Some investors are
concerned about the divergence between the performance of large cap
and small cap companies: the Russell 2000 (RUT) small caps are down
7.5% year-to-date; but the S&P 500 (representing some of the
biggest companies) is still up nearly 5%. Need to Know: The worry
of small-cap stocks
Watch 200 DMA:Wouter Sturkenboom, a London-based investment
strategist at Russell Investment, in emailed comments, said to keep
an eye on the 200-day moving average for the S&P 500 at 1,903,
which could be a "possible inflection point". He added, "If we find
some solid ground we will buy the dip," but said the small-cap
retreat "looks set to keep going a bit longer." Market's October
backdrop remains bearish
Stocks to watch:Yum Brands Inc.(YUM) picked up 1.6% after a big
selloff on Tuesday. The company's profit and outlook missed
estimates, and it slashed expectations for full-year growth in
earnings per share.
Kraft Foods Group Inc. (KRFT) was up 0.5% after the food company
said Tuesday it's raising its quarterly dividend to 55 cents a
share, from 52.5 cents.
Costco Wholesale Corp. (COST) surprised with a 13% rise in
profit on growth in same-store sales and higher sales from
membership fees. Shares rose 1.9%.
Symantec Corp.(SYMC) could be looking at a split, Bloomberg News
reported, citing persons with knowledge of the plans. Shares rose
nearly 2%.
Other markets: European stocks trended lower, with the German
DAX 30 dropping below the key 9,000 level. Travel stocks were hit
particularly hard in Europe on fears the spread of Ebola will
hamper tourism. Stocks in Russia and other emerging markets were
also hit hard as Tuesday's growth warning by the International
Monetary Fund about the health of the global economy continued to
have ripple effects. The case for not panicking over the global
slowdown
The global rout was felt in Asia, where the Nikkei 225 index
lost 1.2%.
Oil prices(CLX4) pushed another leg lower, trading around the
$87-dollar-a-barrel level. On Tuesday in New York it finished at
its lowest level for two years, also weighed by that IMF growth
call. Gold(GCZ4) rose as stocks continued to struggle.
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