Friday, November 22, 2024

Dow futures drop 400 points, stocks head for big loss week on fear Fed is overdoing it

Date:

Stock futures fell on Friday to close out another week of losses as investors feared that the Federal Reserve’s aggressive hike campaign to fight inflation could lead to an economic slowdown.

Dow Jones Industrial Average futures fell 383 points, or 1.3%, while S&P 500 futures were down 1.3%. Nasdaq 100 futures lost 1.5%.

Friday is set to be the fourth consecutive negative session for the major averages, with the Dow on track to take out the bottom of the June closing. The Federal Reserve decided on Wednesday to raise the benchmark interest rate by 75 basis points and indicated it would do so again at its November meeting.

Bond yields surged this week in the wake of the Fed’s actions, with two- and 10-year Treasuries hitting levels not seen in over a decade. The stocks that have suffered the most in the recession led to losses this week with the discretionary consumer sector SPDR fund dropping more than 5%. The SPDR fund for Real Estate Select Sectors is down 6%.

Goldman Sachs S&P 500 target cut for year-end Because rates are rising, with a drop of at least 4% expected from here.

Investors on Friday continued to assess whether the Federal Reserve’s recent moves indicate a future deflation, as many believe or are beginning to accept that a recession is in fact on the horizon.

“Based on our clients’ discussions, the majority of equity investors have taken the view that a difficult downside scenario is inevitable and their focus is on the timing, size and duration of a potential downturn, and the investment strategies for these expectations,” Goldman Sachs wrote. David Costin in a note to clients.

See also  Start flooding in technical profits for 3 days. Here are the main issues to track.

The major averages are on the pace of their fifth decline in the past six weeks and are on track to close the week with losses. The Dow has shed about 2.4% this week, while the S&P and Nasdaq are down 3% and 3.3%, respectively.

Costco slipped in pre-market trading on Friday. Although the retailer reported fiscal fourth-quarter revenue and profits that beat analysts’ expectations, it’s seeing a rise in shipping and labor costs.

In other news, the pound reached its lowest level in more than three decades against the US dollar after a new economic plan in the UK that included a series of tax cuts rocked the markets.

POPULAR

RELATED ARTICLES

How Climate Change Affects Turtle Nesting Sites: What You Need to Know

Climate change is an ever-growing concern, and its effects...

Putin, a member of the International Criminal Court, is set to travel to Mongolia despite an arrest warrant against him

Despite an arrest warrant from the International Criminal Court,...

Japan Typhoon: Millions ordered to evacuate as one of strongest typhoons in decades hits Japan

What's the latest?Posted at 12:48 BST12:48 GMTImage source ReutersTyphoon...