US markets closed mostly lower; Dow bucks trend

The US markets closed mostly lower on Wednesday, as Apple Inc., the largest US company by market cap, tumbled, but the Dow Jones Industrial Average bucked the trend and ended in green. Investors punished the stock after the iPhone maker posted quarterly earnings that slightly beat expectations and revenue that was just shy of forecasts. The market weakness followed a downbeat day on Tuesday when worries about a string of lackluster earnings and a drop in consumer sentiment sent major indexes lower. The oil-price bounce came after the Energy Information Administration reported domestic crude supplies unexpectedly fell in the latest week, a positive sign for a market that continues to struggle with oversupply. The probability of a Fed hike in November is low at only 8.3%, according to the CME Group’s Fed Watch tool, which measures pricing in the Fed funds futures market. However, for December the tool is pointing to an almost 80% chance of a rate increase.

On the economy front, an early look at trade patterns in September points to a sharper than expected drop in the US trade deficit, adding to the picture of an economy that by most measures showed marked improvement in the third quarter. The advanced trade report for goods - services are excluded - showed a deficit of $56.1 billion in September compared to $59.1 billion in August. The size of the trade deficit is generally tied to changes in exports and imports of goods. A smaller deficit boosts the official growth rate of the economy, known as gross domestic product. The size of the decline in September could even be enough to generate 3% GDP.

Meanwhile, new-home sales picked up in September, but hefty downward revisions to sales in earlier months point to a market still struggling for momentum. Sales ran at a seasonally adjusted annual rate of 593,000. That was 3.1% higher than August’s figures, which had originally been reported as 609,000. Sales in September were 29.8% higher compared to a year ago. The median price of new homes sold in September was $313,500, 6.7% higher than in August, and 1.9% higher than a year ago. In part, that reflects dwindling supply. There were 4.8 months’ worth of homes available for sale at the current pace in September, fewer than in August.

The Nasdaq dropped 33.13 points or 0.63 percent to 5,250.27, S&P 500 was down 3.73 points or 0.17 percent to 2,139.43, while the Dow Jones Industrial Average gained 30.06 points or 0.17 percent to 18,199.33.

The Indian ADRs closed mostly in red; Tata Motors was down 1.71%, HDFC Bank was down 0.79%, ICICI Bank was down 0.14% and Wipro was down 0.11%. On the other hand, Dr. Reddy’s Lab was up 0.20%.