(ABM FN-Dow Jones) US stocks were lower on Thursday evening as the dollar and US Treasury yields rose further after the Federal Reserve’s third consecutive mega-rate hike.
With an hour and a half of trading to go, the S&P500 index was 0.7 percent lower at 3,767.29 points.
“It’s slowing down after yesterday’s wild moves,” said Esty Dwek, chief investment officer at FlowBank.
On Wednesday, the markets plunged deep into the red after the interest rate decision by the Federal Reserve. As expected, interest rates were raised by 75 basis points, but the setback was in the so-called ‘dot plot’. Fed policymakers expect the key rate to rise to 4.4 percent this year. This equates to a fourth rate hike of 75 basis points in November and one of 50 points in December.
Powell “did his best not to mention a bright spot at the press conference,” said Christian Hoffmann of Thornburg Investment Management in Santa Fe. “The dot plot remains uneasy for the Fed,” Hoffmann said, because a too-low projected interest rate spike could mean unchecking inflation and too high a projected interest rate spike could wreck the economy.
According to market analyst Naeem Aslam of AvaTrade, equity markets are under pressure as investors fear a recession in the United States. “Many even think the Fed is aiming for a recession, given the aggressiveness with which it is acting,” Aslam said.
On Thursday, central banks in Switzerland, Norway and the UK also raised interest rates. The central bank in Turkey, on the other hand, cut interest rates, despite an inflation rate of more than 80 percent.
In addition, the number of first-time jobless claims in the US increased by 5,000 to 213,000. Leading indicators deteriorated as expected and consumer confidence plunged to a new low in September.
The price of oil had changed little, at $83.13 for a November WTI futures oil. Government agency EIA reported a higher stock of natural gas.
The euro/dollar continued its decline, trading at 0.9832.
Meta Platforms wants to reduce costs by at least 10 percent in the coming months. This reported The Wall Street Journal. A reorganization is currently underway, old and current executives of the company told the business newspaper, and will result in job cuts.
Crypto exchange FTX wants to raise a billion dollars from investors in a new financing round. The new financing round would value FTX at $32 billion, equal to the valuation at an earlier financing round in January this year.
FedEx’s figures will be on the roll tonight after the close of trading. But after a recent warning and price drop, they probably won’t cause much movement anymore. FedEx withdrew its outlook for this year. The delivery person is experiencing headwinds, especially in Asia and Europe. FedEx wants to cut costs, including by introducing a staff freeze and closing locations. The stock fell 1.5 percent.
Source: ABM Financial News
From Beursplein 5, the editors of ABM Financial News closely follow developments on the stock exchanges, and the Amsterdam stock exchange in particular. The information in this column is not intended as professional investment advice or as a recommendation to make certain investments.