November 26, 2022

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Stock futures drop after a choppy session following the latest Fed rate hike

Stock futures drop after a choppy session following the latest Fed rate hike

Stock futures fell on Thursday after losses during the previous session after the Federal Reserve raised interest rates again and indicated that there is no pivot or rate cut any time soon.

Futures linked to the Dow Jones Industrial Average were down 23 points, or 0.1%. S&P 500 and Nasdaq 100 futures were down 0.1% and 0.2%.

Traders had expected a 0.75 percentage point interest rate hike by the central bank and initially read the Fed’s statement as bearish, sending stocks higher on Wednesday after the decision. Those gains were then reversed when Fed Chair Jerome Powell said it was “too early” to talk about a pause in rate hikes and that the final interest rate would likely be higher than previously reported.

“We still have some ways to go and the data from our last meeting suggests that the final level of interest rates will be higher than previously expected,” he said.

The Dow Jones Industrial Average ended Wednesday’s session 505 points, or 1.6%, lower. The S&P 500 is down 2.5%, and the Nasdaq Composite is down 3.4%.

Markets will likely continue to swing until it becomes clear that inflation has subsided and that the Fed has stopped pushing rates higher. Any data showing that the US economy is not slowing down as the tightening central bank policy is likely to affect stocks.

The next important report is the October non-farm payroll, due for release on Friday.

“You get a good job number, in other words a good unemployment rate that doesn’t go up, the market is in a lot of trouble,” Jay Adami, director of advocacy for advisors at the Private Advisor Group, said on CNBC. Quick money.”

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Meanwhile, corporate earnings season continued, with QualcommAnd the Rocco And the fortinet All fell sharply after reporting disappointing quarterly results and forward guidance.

Correction: A previous version missed the drop in the Wednesday session.