U.S. stocks barreled lower Tuesday as investors prepared for Federal Reserve officials to deliver another jumbo rate hike in their fight against persistent inflation.
[Click here to read what's moving markets on Wednesday, Sept. 21]
The benchmark S&P 500 slid 1.1% while the Dow Jones Industrial Average shed 313 points, or 1.01%. The technology-heavy Nasdaq Composite declined about .95%.
One fourth of all trading days so far this year have seen declines of 1% or more, according to data from Bespoke Investment Group. The only other post-WWII years with a higher frequency of days with such losses were 1974, 2002, and 2008.
As Wall Street awaits the meeting outcome, the benchmark U.S. 10-year Treasury remains well above 3.5%, its highest level since 2011, while the 2-year Treasury note is racing toward 4%.
The policy-setting Federal Open Market Committee kicks off its September meeting today and is expected to deal a third-straight 75-basis-point increase to its benchmark interest rate at the conclusion of discussions Wednesday. After officials convene, investors will tune in for a speech by Fed Chair Jerome Powell for further clues around the pace and magnitude of future hikes.
“A third ‘unusually large’ hike would be a reversal from the plan Chair Powell laid out in July to slow the pace of tightening, despite little surprise on net in the data,” economists at Goldman Sachs led by Jan Hatzius wrote in a note.
“We see several reasons for the change in plan: the equity market threatened to undo some of the tightening in financial conditions that the Fed had engineered, labor market strength reduced fears of overtightening at this stage, Fed officials now appear to want somewhat quicker and more consistent progress toward reversing overheating, and some might have reevaluated the short-term neutral rate.”
Bank of America expects the Fed’s dot plot – each official’s forecast for the central bank's key short-term interest rate – to show an “implicit slowing” in the tempo of hikes at its November meeting. But analysts suggest Powell is likely to discount this signal and continue to emphasize that increases will be data dependent to maintain optionality for the Fed.
“In other words, if the data were to justify another 75-basis-point rate hike in November, we do not think the committee would be constrained by its prior projection,” BofA analysts led by Michael Gapen said in a note. “We suspect the Fed will rely less on forward guidance and more on data dependence as the policy rate moves further into restrictive territory.”
—
Alexandra Semenova is a reporter for Yahoo Finance. Follow her on Twitter @alexandraandnyc
Click here for the latest trending stock tickers of the Yahoo Finance platform
Click here for the latest stock market news and in-depth analysis, including events that move stocks
Read the latest financial and business news from Yahoo Finance
Download the Yahoo Finance app for Apple or Android
Follow Yahoo Finance on Twitter, Facebook, Instagram, Flipboard, LinkedIn, and YouTube
Related Quotes
Cowen Managing Director and Head of Market Strategy Chris Pollard examines the impact of the Fed's interest rate hikes on markets as stocks rally and the economic environment amid inflationary and labor pressures.
Things were starting to look up for the Panthers in the power rankings. Then, Week 4 happened.
The volatile market has investors playing it safe.
Shares of electric vehicle (EV) stocks Nio (NYSE: NIO), Lucid Group (NASDAQ: LCID), and Lordstown Motors (NASDAQ: RIDE) fell on Wednesday, down 5.1%, 3.6%, and 4.9%, respectively, as of 2:17 p.m. EDT. After a huge amount of selling in September, stocks were beaten down, but the first two days in October saw some potentially good news on inflation. With traders trying to sniff out the first signs of inflation breaking, that was a good sign.
Chip stocks have had a brutal ride in 2022. The tables have turned on a sector particularly sensitive to cycles; after seeing outsized growth during the pandemic, and despite the global chip shortage, waning demand has seen many in the segment hit hard. Factor in some lofty valuations, a slowing economy and fears of a full-blown recession and the result is the SOX (the main Semiconductor index) is down by 38% year-to-date. That said, there are many good companies operating in the space whose sha
These two stocks are among the riskiest in the Berkshire Hathaway portfolio, but they could be huge winners.
Two of the most prominent mortgage real estate investment trusts (REITs), Annaly Capital Management (NYSE: NLY) and AGNC Investment (NASDAQ: AGNC), were down sharply during trading on Wednesday. Annaly Capital was down as much as 9% on the day at around noon ET, while AGNC fell as far as 9.7% on the day at around the same time. As both Annaly Capital and AGNC Investment are mortgage REITs, they were each negatively affected by the latest news from the housing industry.
Shares of AMC Entertainment Holdings (NYSE: AMC) are tumbling 9.1% at 11:06 a.m. ET on Wednesday after defunct gold and silver miner Hycroft Mining (NASDAQ: HYMC) reported it received a delisting notice from the Nasdaq Stock Market. AMC surprised investors earlier this year by taking a 22% stake in Hycroft in exchange for a $28 million cash infusion. Metals investor Eric Sprott invested a similar amount into Hycroft in return for the same percentage ownership position.
Here's why stocks have come out of the gate with gusto to kick off the fourth quarter.
(Bloomberg) — One giant options transaction may have sparked the S&P 500’s bounce on Wednesday, according to Wells Fargo & Co. Most Read from BloombergMusk Revives $44 Billion Twitter Bid, Aiming to Avoid TrialTrump Says US Agency Packed Top-Secret Documents. These Emails Suggest Otherwise.Loretta Lynn, Coal Miner's Daughter And Country Queen, DiesMar-a-Lago Documents Included Pardons, Emails, Legal BillsStocks Take Breather After Furious Rally From Low: Markets WrapThe trade, which involved bu
The stock market rally showed resilience, as the Dow Jones slashed early losses, but is at a pivotal point. Tesla fell while Enphase plunged.
Make it two days in a row of big gains for Biohaven Ltd. (NYSE: BHVN). The momentum is primarily due to the company's new beginning after being spun off from Biohaven Pharmaceutical. Pfizer (NYSE: PFE) closed on its acquisition of Biohaven Pharmaceutical on Monday, with Biohaven Ltd. created as a spin-off before the transaction finalized.
Outspoken Barstool Sports founder Dave Portnoy thinks that investors might miss opportunities to invest in the stock market if they are dominated by fear.
Jeffrey Bierman, chief market technician at TheoTrade, has made prescient market calls this year. He sees year-end gains ahead, and sees two ridiculously cheap sectors to buy.
Many investors believe Apple (NASDAQ: AAPL) is one of the best companies in the world, and I'm not here to argue against that proposition. While many stocks have seen their valuations come down, Apple's has stayed elevated. Additionally, economic headwinds are popping up that could spell disaster for Apple.
OPEC+ will cut oil production by 2 million barrels per day amid looming demand concerns and the ongoing friction between the West and Russia over the war in Ukraine.
You can hold on to Series I bonds for 30 years, but if you jumped in when the interest rate skyrocketed to 9.62%, you might be looking for an off-ramp well before then. The total return on I-bonds is made up of two parts — a fixed rate that’s set at the time of purchase and an inflation-adjusted rate that resets every six months, in November and May. The fixed rate has been 0% since May 2020. Looking at numbers already published, David Enna, founder of TipsWatch.com, a website that tracks inflation-protected securities, predicts the variable inflation-adjusted portion of the I-bonds formula will be around 6.3%, and likely fall to 3.5% eventually.
Dividend stock Phillips 66 is a diversified energy company operating through four segments: midstream, refineries, chemicals and marketing.
In this article, we will take a look at the 10 stocks recently upgraded by analysts. If you want to see some more stocks on the list, go directly to Analysts are Upgrading These 5 Stocks. U.S. stocks turned red on Wednesday morning after staying in positive territory during the last two trading sessions. Meanwhile, […]
Create the bull call spread trade by first buying a call and then selling a further out-of-the-money call.