US EQUITY OPEN: Stocks pare some of the hawkish Fed induced weakness as tech rallies

OPEN: Stocks have opened in the green after the sharp downside seen on Wednesday after the hawkish FOMC statement, SEPs and press conference with the Fed putting extra emphasis on getting inflation back to target, while the dot plot median pencilled in one rate hike this year vs one rate cut seen in the March SEP. 

The Nasdaq is outperforming as semiconductors rally, with the iShares PHLX Semiconductor ETF (SOXX) rising 5% while the S&P also retraces a lot of the post-FOMC losses thanks to the gains in tech. Sectors are predominantly firmer with Tech and Industrials leading, while Energy is the clear laggard, followed by communication names amid downside in Google (GOOGL) and Netflix (NFLX). Meanwhile, IT Services names are taking a beating after Accenture (ACN) earnings, which saw it cut revenue guidance, and in turn weighing on IBM (IBM), Cognizant (CTSH) and Infosys (INFY).  

Elsewhere, the Dollar sees marginal gains with Aussie and Kiwi leading gains amid the gains in equities, while the Swissy and Pound lag after their respective rate decisions this morning. 

Crude prices continue to drop amid the signing of the US/Iran MoU, while talks are set to enter stage two about the nuclear issue from Friday, although reports continue to suggest Iran has not yet made up its mind about attending the Switzerland signing. Additional pressure came after Kuwait stated that it will begin boosting oil output to above 2mln BPD in a week.

Treasury yields are lower across the curve, paring some of the post-FOMC upside after a hawkish Warsh as the bond market battles a more hawkish Fed policy and lower oil prices amid the easing of geopolitical risk premiums. 

US data had little market impact, but jobless claims were in line with forecasts, while the Philly Fed survey beat on the headline. 

STOCK SPECIFICS

• Intel (INTC): Trump said Apple has agreed to work w/ Intel to design & build its chips in America
• Apple (AAPL): CEO Cook said it plans to raise prices due to the memory chip crunch
• Accenture (ACN): Rev. light & disappointing FY profit view while it lowered revenue guidance.
• Kroger (KR): Profit marginally missed & reiterates FY guidance.
• Nucor (NUE): Raised next Q profit view
• Steel Dynamics (STLD): Cut next Q EPS outlook.
• Pfizer (PFE): CFO to step down, effective Aug. 15th.