Wall Street falls ahead of expected Fed rate hike

Wall Street falls ahead of expected Fed rate hike

US stocks fell and the dollar rose on Friday, despite improved Treasury yields, as traders weighed further interest rate hikes by the Federal Reserve to combat inflation.

* Faced with the looming rate hike, high-growth and tech stocks including Amazon.com Inc and Alphabet Inc fell more than 2%. Banks were lower, on track to end the week in the red, which could end their six-week winning streak. Also, poor results from heavy equipment maker Deere & Co. added to the risk.

* As of 1700 GMT, the Dow Jones Industrial Average was down 187.76 points, or 0.56%, at 33,810.45; the S&P 500 index was down 44.69 points, or 1.03%, at 4,239.46; and the Nasdaq Composite fell 233.32 points, or 1.80%, to 12,731.94.

* European stocks fell, ending the week lower, as the higher rise in German producer prices in July contributed to a worsening economic outlook. The pan-European STOXX 600 index fell 0.8%.

* MSCI’s measure of global shares fell 1.28%.

* “When market players come back from their holidays and look back … they will see that central banks are still far from achieving their goals of curbing inflation,” ING rates strategists said in a note to their peers. customers.

* “That means a continuing struggle between central bank tightening expectations and recession fears,” he added.

* The Fed needs to keep raising borrowing costs to rein in high inflation, a number of US central bank officials said on Thursday, even as they debated how fast and how high to raise them.

* The dollar benefited from the Fed’s comments and investors’ caution, hitting a one-month high. The dollar index gained about 0.6% to 108.14 points, and the euro fell 0.5% to $1.0036.

* Benchmark 10-year Treasury yields edged higher, nearing a one-month high of 2.9776%.

* Oil prices added a third day of gains after suffering early losses in the session.

* Gold was headed for its first weekly decline in a month, after hitting a three-week low. Spot gold fell for the fifth straight session, shedding nearly 0.5% to $1,749 an ounce, in what could be its longest losing streak since November 2021.

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