Wall Street falls on fears of rate hike

Wall Street fell as megacap growth and tech stocks lead a broader market decline, while fears of rate hikes dampened risk appetite.

Stocks shook this week as investors tried to pinpoint the central bank’s direction of tightening monetary policy after minutes of the U.S. Federal Reserve’s (Fed) July meeting were released on Wednesday. .

Blue chip Dow posted modest weekly gains on good terms, while the Nasdaq and S&P 500 were headed for first weekly declines after four consecutive weeks of gains.

Dennis Dick, a private trader at Triple D Trading, pointed to the weak performance of Deere & Co, German inflation, and the plummeting meme, saying, “There’s a lot of individual news today that isn’t all that big news. , which is reflected in the plunge in the overall market.” stocks and cryptocurrencies.

“The last six weeks have been pretty strong, so we’re making a little bit of profit.”

Deere fell 2.8% after falling short of earnings forecasts as the world’s largest heavy equipment maker continues to grapple with parts shortages stemming from supply chain disruptions.

The industrial sector of the S&P 500 fell 1%.

High-growth and tech stocks such as Amazon.com and Alphabet have nearly doubled, mimicking European bonds after U.S. Treasury yields rose and Germany reported a record rise in monthly producer prices. % fell.

Bank stocks also fell 1.3%, potentially breaking a six-week winning streak, and tended to end the week lower.

Meanwhile, Richmond Federal Reserve Governor Thomas Birkin said on Friday that the central bank’s efforts to contain inflation could lead to a recession, but it need not be a “disaster.”

St. Louis Fed President James Bullard said he was leaning toward favoring a third consecutive 75 basis point rate hike in September, while San Francisco Fed colleague Mary Daly said a 50 basis point rate hike next month is likely. or 75 basis points is “reasonable.” .

In early trading on Friday, the Dow Jones Industrial Average fell 192.74 points (0.57%) to 33,806.30, the S&P 500 fell 38.75 points (0.90%) to 4,244.99, and the Nasdaq Composite fell 187.97 points. 1.45% at 12,777.37.

The Fed has raised its benchmark overnight rate by 225 bps since March to combat the highest inflation in 40 years.

The focus next week will be Fed Chairman Jerome Powell’s speech on the economic outlook at the annual World Central Banks meeting in Jackson Hole, Wyoming.

Cryptocurrency and blockchain stocks tumbled after bitcoin plunged, with crypto exchange Coinbase Global and miner Marathon Digital dropping 8.5% and 11.5% respectively.

Bed Bath & Beyond Inc plunged 41.1% as billionaire investor Ryan Cohen sold his stake and exited the struggling home goods retailer.

General Motors rose 1.8% after announcing it would resume quarterly dividend payments.

Losers outnumbered gainers by a ratio of 7.56 to 1 on the NYSE and 5.16 to 1 on the Nasdaq.

The S&P index made one 52-week high and 29 lows, while the Nasdaq made 10 highs and 35 lows.