The outlook on Wall Street is bleaker after notes from a U.S. Federal Reserve meeting dented hopes that interest rate hikes are finished, according to the Associated Press.
The S&P 500 lost 0.8% on Wednesday after minutes from the Fed’s latest meeting suggested board members are unsure what to do after raising their key lending rate to a two-decade high. Traders had hoped the board would decide inflation was under control and that last month’s rate hike was the last. The Dow lost 0.5% and the Nasdaq composite dropped 1.1%.
Big technology stocks and other investments seen as particularly vulnerable to higher rates were some of the biggest decliners on Wednesday. Tesla fell 3.2%. Facebook’s parent, Meta Platforms, dropped 2.5%, and Amazon fell 1.9%.
In early trading today, futures for the S&P 500 and the Dow Jones Industrial Average were just 0.1% higher.
The bond market is drawing money out of stocks as rising interest rates increase the yield, or the difference between the market price and the payout at maturity.
Yields widened further after the release of Fed notes increased expectations of another possible rate hike. When safer bonds pay higher returns, investors often feel less incentive to buy stocks, which have more volatile prices.
In energy markets today, benchmark U.S. crude rose 30 cents to $79.68 per barrel in electronic trading on the New York Mercantile Exchange. The contract fell $1.61 on Wednesday to $79.38. Brent crude, the price basis for international oils, advanced 34 cents to $83.79. It retreated $1.44 the previous session to $83.45 a barrel.
The dollar declined to 146.13 yen from Wednesday’s 146.24 yen.
