U.S. stocks finished lower on Tuesday as Treasury yields climbed and traders appeared skittish about opening new long positions ahead of the conclusion of the Federal Reserve’s September policy meeting.
- The Dow dropped -313.45 or -1.01%
- The S&P 500 fell -43.96 or -1.13%
- The Nasdaq declined -109.97 or -0.95%
The next Federal Open Market Committee decision is looming over the market, as investors grapple not just with whether the central bank will make a 75 basis point rate increase or lift rates by 100 points, but also with how high the Fed will signal rates will go in the future. The meeting started Tuesday and will conclude on Wednesday.
Of course, the Fed isn’t the only major central bank hiking interest rates to fight stubbornly high inflation. Sweden’s Riksbank on Tuesday opted for a 100 basis point hike, and analysts expect at least a half-point rise when the Bank of England meets Thursday.
European central banks were particularly on edge after producer prices in Germany increased by more than 45% in August compared with the same period a year ago, news that may also be influencing U.S. markets.
All 11 S&P 500 sectors finished in the red on Tuesday, with real estate, materials, and consumer discretionary shares seeing the biggest losses. As a result, the SPDR S&P Retail ETF Materials Select Sector SPDR Fund and iShares U.S. Real Estate ETF were all sharply lower…….[read more]
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