New York stocks plunge sharply as Fed signals a rate hike within the year
At the U.S. Federal Open Market Committee, the benchmark interest rate was held at 3.50~3.75%, but New York stocks fell across the board after the Fed signaled the possibility of an additional hike within the year. The Dow fell 3 major indices all declined. The Dow dropped 507.12 points (0.98%) to close at 51,492.55. The S&P500 fell 91.25 points (1.21%) to 7,420.10, while the Nasdaq declined 354.69 points (1.34%) to finish at 26,021.66.
The U.S. Federal Open Market Committee held the benchmark interest rate at 17~3.50% on 3.75. However, market anxiety grew as the officials’ projections reflected the possibility of an additional rate hike within the year.
The median projection for the benchmark interest rate at the end of this year in the dot plot was raised from 3.4% to 3.8%. New Chair Kevin Warsh deleted the phrase “easing bias” from the statement.
U.S. Treasury yields surged immediately after the meeting. As a result, New York stocks 3 major indices closed lower.
Dow Jones30The Industrial Average fell 507.12 points (0.98%) to close at 51,492.55. The S&P500 index fell 91.25 points (1.21%) to close at 7,420.10.
The Nasdaq Composite fell 354.69 points (1.34%) to close at 26,021.66. At the start of the session, the index also opened higher as markets awaited Chair Kevin Warsh’s first FOMC meeting.
Investors also focused on Chair Warsh’s repeated emphasis during the press conference on his commitment to price stability. The market reaction was reported to have resulted from the dot plot becoming more hawkish.