US stocks end volatile session lower as impact of Fed rate hikes outweighs strong GDP growth
- The S&P 500 fell for a third straight session on Thursday after rallying earlier in the day.
Nasdaq Compositealso turned lower as investors price in rate hikes by the Federal Reserve.
The S&P 500 closed with a third straight loss, led by pullbacks for consumer discretionary shares. Technology shares also fell, with Tesla down as investors were disappointed by product delays for its Cybertruck and Semi truck. Apple slipped ahead of quarterly financial results late Thursday.
Wall Street's big benchmarks had risen earlier in the session after the Commerce Department said the world's largest economy grew at an annualized rate of 6.9% in the fourth quarter. That was well above the 5.5% median forecast from economists surveyed by Bloomberg. The data also showed growth accelerated from the 2.3% pave in the third quarter.
Here's where US indexes stood at 4:00 p.m. on Thursday:
- S&P 500: 4,326.52, down 0.54%
- Dow Jones Industrial Average: 34,160.78, down 0.02% (7.31 points)
- Nasdaq Composite: 13,352.78, down 1.40%
"Volatility is the market driver du jour, as investors reacted to the post-FOMC comments from Powell, which were more hawkish than many investors anticipated," said Greg Bassuk, CEO of AXS Investments, in a note to Insider.
Stocks reversed lower on Wednesday, giving steep gains, after Fed Chair Jerome Powell indicated that a rate hike at every meeting this year is not off the table with inflation risks to the upside.
"Notwithstanding the greater volatility sparked by the latest FOMC views, investors could benefit from several key moves, including a rotation out of growth and into value stocks that offer a margin of safety," said Bassuk.
Being overweight on inflation-sensitive assets such as commodities and cyclical stocks "not only mitigate inflationary woes, but also perform well in price-rising environments," he added
The International Monetary Fund predicted more pain for global stocks as central banks around the world tighten their monetary policies to curb rising inflation.
Bitcoin turned lower, losing 2.1% to $36,056.78.
- 'Die-hard' Nintendo fan spent over $40,000 buying stock and then asked top executives why the company won't make more of a fan-favorite series
- Mark Zuckerberg told Meta staff he's upping performance goals to get rid of employees who 'shouldn't be here,' report says
- Four-days work week, full and final settlement within 2 days of exit — new changes at workplaces to reflect from July 1
- It’s not the CM seat but the one who wields ‘bow and arrow’ will be the Sena head
- SIMPLY PUT: extreme weather is the new normal in India
- Antonia Wade, PwC's global CMO, tells Insider how B2B spending changes in tough economic times
- Ban on single-use plastic kicks in across India as the country recognises the choking impacts of plastic waste on the environment
- Bank FDs will draw down from mutual funds if interest rates go up to 7.5-8%, says report