Wall Street falls for third straight session worries about Fed rate hike

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A trader works on the floor of the New York Stock Exchange (NYSE) in New York City, US, Aug. 29, 2022. REUTERS/Brendan McDermid

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  • Best Buy sales beat estimates as discounts boost demand
  • Vacancies in July rise sharply
  • Dow Jones down 1.02%, S&P 500 down 1.22%, Nasdaq down 1.45%

Aug 30 (Reuters) – US stocks slumped for the third straight session on Tuesday as a rise in job openings fueled concerns that the US Federal Reserve has another reason to continue its aggressive path of rate hikes to fight inflation to make.

The benchmark S&P 500 index (.SPX) is down more than 5% since Fed Chair Jerome Powell on Friday confirmed the central bank’s determination to raise interest rates even in the face of a slowing economy. read more

Labor demand showed no signs of slowing down as US job openings rose to 11.239 million in July and was revised sharply higher the month before. A separate report showed that consumer confidence recovered strongly in August after three consecutive monthly declines. read more

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“It’s fueling a strong job market, it also points to no apparent consumer concern and that goes against what the market is really looking for,” said Andre Bakhos, managing member at Ingenium Analytics LLC in Plainsboro, New Jersey.

“Normally you would take this as good news, but we have the inflation part that is the concern and numbers like this don’t play well when trying to drive down inflation, at least that’s the perception of the market.”

The data increases focus on August nonfarm payroll data expected on Friday.

The Dow Jones Industrial Average (.DJI) fell 327.54 points, or 1.02%, to 31,771.45, the S&P 500 (.SPX) lost 49.12 points, or 1.22%, to 3,981.49, and the Nasdaq Composite (.IXIC) fell 173.88 points, or 1.45%, to 11,843.79.

New York Fed President John Williams said on Tuesday that the central bank will likely have to meet its key rate of about 3.5% and that it is unlikely to cut rates next year as it fights inflation.

However, Atlanta Fed president Raphael Bostic said in an essay published Tuesday that the Fed could “call back” from its recent string of 75 basis point increases if new data shows inflation is “clearly slowing” as the president of the Richmond Fed , Thomas Barkin, said the Fed’s pledge to bring inflation back to the 2% target does not necessarily lead to a severe recession. read more

Traders estimate a 74.5% chance of a third consecutive 75 basis point rate hike at the Fed’s September meeting.

Each of the 11 sectors of the S&P 500 was in negative territory, with the energy sector (.SPNY) falling 3.27% as oil prices fell more than 5% on concerns that a slowdown in global economies could undermine demand . read more

Ten-year Treasury yields wiped out early morning losses and traded higher at 3.119%.

Rate-sensitive mega-cap growth and technology stocks such as Microsoft Corp (MSFT.O), which lost 1.32%, and Apple Inc (AAPL.O), which valued 1.69%, were the biggest barriers to the benchmark -index.

Both the S&P 500 and the Nasdaq have broken below their 50-day moving average. The S&P 500 also briefly fell below the 50% Fibonacci retracement level from its June to August low, another key technical indicator viewed as support by analysts.

SPX technical

The CBOE Volatility Index, also known as Wall Street’s fear meter, rose for the third straight session, last trading at 26.92 points.

Adding to the concerns, the Taiwanese military fired warning shots at a Chinese drone that buzzed a Taiwan-controlled islet near the Chinese coast. read more

However, Best Buy Co (BBY.N) rose 2.25%, its biggest gain on the S&P 500 after it reported a smaller-than-expected decline in quarterly comparable sales due to steep discounts. read more

The number of declining issues surpassed the advancing ones on the NYSE by a 4.83 to 1 ratio; on Nasdaq, a 2.92-to-1 ratio favored decliners.

The S&P 500 made no new 52-week highs and 18 new lows; the Nasdaq Composite recorded 7 new highs and 196 new lows.

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Reporting by Chuck Mikolajczak; Editing by David Gregorio

Our Standards: The Thomson Reuters Trust Principles.

The Valley Voice
The Valley Voicehttp://thevalleyvoice.org
Christopher Brito is a social media producer and trending writer for The Valley Voice, with a focus on sports and stories related to race and culture.

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