NYSE Dow Jones finished today at:

[bigdog]

New York Thanksgiving holiday on Thursday

Asian shares gain after earnings-fueled rally on Wall Street

Asian shares have risen after solid earnings pushed retailers higher on Wall Street ahead of the Thanksgiving holiday in the U.S.

apnews.com

US stocks rise, strong earnings send retailers higher​

By DAMIAN J. TROISE and ALEX VEIGA

Stocks on Wall Street closed broadly higher Tuesday, as solid company earnings helped lift several retailers ahead of the Thanksgiving holiday in the U.S.

The S&P 500 rose 1.4%, more than making up for its losses last week. The Dow Jones Industrial Average rose 1.2% and the Nasdaq composite gained 1.4%.

All the company sectors in the benchmark S&P 500 index rose, with technology stocks driving much of the rally. Chipmaker Nvidia rose 4.7%.

Financial and health care stocks also helped lift the market. Charles Schwab rose 1.6% and Pfizer added 1.9%.

Energy stocks notched the biggest gain as the price of U.S. crude oil rose 1.5%. Chevron rose 2.6%.

“Yesterday’s slow sell-off of energy was overdone,” said Jay Hatfield, CEO of Infrastructure Capital Advisors. “So you’re getting a bounce back in energy and that’s really leading the market.”

Long-term Treasury yields fell. The yield on the 10-year Treasury, which influences mortgage rates, slipped to 3.77% from 3.84% late Monday.

“When rates go down it’s great for all stocks,” Hatfield said.

The S&P 500 rose 53.64 points to 4,003.58. The Dow gained 397.82 points to 34,098.10. The tech-heavy Nasdaq climbed 149.90 points to 11,174.41.

Smaller company stocks also got a boost. The Russell 2000 rose 21.20 points, or 1.2%, to 1,860.44.

Investors have very little news to review this week, but several retailers and technology companies are closing out the latest round of corporate earnings with their financial results. Best Buy surged 12.8% after the electronics retailer did better than analysts expected and said a decline in sales for the year will not be as bad as it had projected earlier.

Dell Technologies rose 6.8% after the computer maker reported strong third-quarter profit and revenue. Zoom Video slumped 3.9% after giving investors a weak profit and revenue forecast.

Several retailers made particularly strong gains following solid financial results. Abercrombie & Fitch surged 21.4% and American Eagle jumped 18.2%.

Nearly every company in the S&P 500 has reported their latest financial results, according to FactSet, and the results have been mixed. Companies in the index have reported overall earnings growth of about 2%, but have also issued various warnings about weaker consumer demand and crimped sales as inflation continues squeezing consumers.

Inflation and the Federal Reserve’s fight to tame it remains the main concern for Wall Street. The central bank on Wednesday will release minutes from its latest policy meeting, potentially giving investors more insight into its decision-making process.

Wall Street has been hoping that the central bank might ease up on its aggressive rate increases. Its benchmark rate currently stands at 3.75% to 4%, up from close to zero in March.

The Fed has warned that it may have to ultimately raise rates to previously unanticipated level to cool the hottest inflation in decades. That strategy raises the risk that it could go too far in slowing economic growth and bring on a recession.

Worries about a recession continue hanging over the global economy and markets.

The Paris-based Organization for Economic Cooperation and Development is forecasting modest economic growth globally this year and more tepid growth in 2023. Russia’s war in Ukraine continues threatening energy supplies and key food commodities including wheat. A resurgence of COVID-19 cases in China continues threatening the world’s second-largest economy and global supply chains.

“In 2023, we expect less pain but also no gain,” stated a report from Goldman Sachs looking ahead to the new year.

The investment bank expects inflation and high interest rates to essentially flatten out corporate earnings and hold the broader stock market at its current levels, with the S&P 500 ending 2023 where it currently sits at around 4,000 points.

Market Watch
ASX 200 futures up 75 points or 1.04% to 7251 at 07:58:34 AEDT

The S&P 500 rose 1.4%, more than making up for its losses last week. The Dow Jones Industrial Average rose 1.2% and the Nasdaq composite gained 1.4%.

The S&P 500 rose 53.64 points to 4,003.58. The Dow gained 397.82 points to 34,098.10. The tech-heavy Nasdaq climbed 149.90 points to 11,174.41.

 

[bigdog]

Thanksgiving US holiday on Thursday

Stocks gain ground on Wall Street ahead of US holiday

Stocks closed broadly higher on Wall Street Wednesday, after the minutes from the Federal Reserve's most recent policy meeting showed central bank officials agreed that smaller rate hikes would likely be appropriate “soon.”

apnews.com

Stocks gain ground on Wall Street ahead of US holiday​

By DAMIAN J. TROISE and ALEX VEIGA

Stocks closed broadly higher on Wall Street Wednesday, after the minutes from the Federal Reserve’s most recent policy meeting showed central bank officials agreed that smaller rate hikes would likely be appropriate “soon.”

The S&P 500 rose 0.6%, while the Dow Jones Industrial Average gained 0.3%. The Nasdaq composite closed 1% higher.

Long-term Treasury yields fell. The yield on the 10-year Treasury, which influences mortgage rates, slipped to 3.69% from 3.76%.

At the Nov. 1-2 meeting, Fed officials expressed uncertainty about how long it might take for their rate hikes to slow the economy enough to tame inflation. And at a news conference afterward, Chair Jerome Powell stressed that that the Fed wasn’t even close to declaring victory in its fight to curb high inflation. Other Fed officials in the weeks since the meeting signaled that additional hikes would still be necessary.

Still, a “substantial majority″ of the officials felt that smaller rate hikes “would likely soon be appropriate,” according to the minutes of their meeting

That line of thinking is likely to stoke optimism among investors who have been trying to gauge how soon central bank officials would begin to dial back the aggressive pace of rate hikes in the Fed’s campaign to lower inflation

“Markets continue to hold onto gains as the Fed minutes reinforce what Fed speakers have been telegraphing since the November 1-2 meeting,” said Quincy Krosby, chief global strategist for LPL Financial. “That is that the Fed is stepping down in terms of rates, from the aggressive campaign of 75 basis points to 50 basis points most likely at the December 13-14 meeting.”

The central bank’s benchmark rate currently stands at 3.75% to 4%, up from close to zero in March. It has warned that it may have to ultimately raise rates to previously unanticipated levels to cool the hottest inflation in decades.

During their meeting, Fed officials also expressed uncertainty about how long it might take for their rate hikes to tame inflation, though some expressed hope that falling commodity prices and the unsnarling of supply chain bottlenecks “should contribute to lower inflation in the medium term.”

Wall Street has been closely watching the latest economic and inflation data for any signs that might allow the Fed to ease up on future rate increases. Investors are worried that the Fed could slam the brakes too hard on economic growth and bring on a recession

Consumer spending and the employment market have so far remained strong points in the economy. That has helped as a bulwark against a recession, but also means the Fed may have to remain aggressive.

The number of Americans applying for unemployment benefits rose last week to the highest level since August, but the figure still remains low by historic standards. A November survey from the University of Michigan shows that consumer sentiment grew from October by more than economists had expected.

Technology stocks and some big retailers helped drive a big share of the gains in the benchmark S&P 500 index Wednesday. Chipmaker Nvidia rose 3% and Target rose 3.5%.

Farming equipment maker Deere gained 5% after reporting stronger financial results than analysts were expecting.

Homebuilders rose broadly following a government report showing that sales of new U.S. homes rose more than expected in October. Lennar gained 1.6% and D.R. Horton rose 2.2%.

Crude oil prices fell 3.7%, which weighed down energy stocks. Hess fell 2.2%.

All told, the S&P 500 rose 23.68 points to 4,027.26. The Dow gained 95.96 points to 34,194.06. The Nasdaq rose 110.91 points to 11,285.32.

The Russell 2000 index of smaller companies edged higher, adding 3.08 points, or 0.2%, to close at 1,863.52.

European markets closed mostly higher and Asian markets closed mixed overnight.

Trading has been unsteady during the holiday-shortened week, but major indexes are on track for weekly gains. U.S. markets will be closed Thursday for Thanksgiving and will close early on Friday.


Market Watch
ASX 200 futures up 4 points or 0.1% to 7254 at 07:59:02 AEDT

All told, the S&P 500 rose 23.68 points to 4,027.26. The Dow gained 95.96 points to 34,194.06. The Nasdaq rose 110.91 points to 11,285.32.

The S&P 500 rose 0.6%, while the Dow Jones Industrial Average gained 0.3%. The Nasdaq composite closed 1% higher.

 

[bigdog]

NYSE closed for Thanksgiving US holiday on Thursday

Global shares rise on Fed rate hopes despite China worries

TOKYO (AP) — Global shares gained Thursday, although optimism about the Federal Reserve holding back on aggressive interest rate raises was countered by some uncertainty about coronavirus restrictions in China .

apnews.com

Global shares rise on Fed rate hopes despite China worries​

By YURI KAGEYAMA

TOKYO (AP) — Global shares gained Thursday, although optimism about the Federal Reserve holding back on aggressive interest rate raises was countered by some uncertainty about coronavirus restrictions in China.

France’s CAC 40 edged up 0.1% in early trading to 6,685.49, while Germany’s DAX gained 0.3% to 14,474.23. Britain’s FTSE 100 gained 0.1% to 7,475.55. The future for the Dow industrials edged 0.2% higher. The future for the S&P 500 added 0.3%.

Trading has been unsteady during the holiday-shortened week. U.S. markets are closed Thursday for Thanksgiving and will close early on Friday.

“A headwind for Asian markets is the COVID situation in China, where investors seem to be avoiding local assets and commodities as the country is seeing near-record numbers of COVID cases. Broad restrictions will keep weighing on risk sentiment and macroeconomic fundamentals, putting pressure on the outlook for cyclical stocks and commodities,” Anderson Alves of ActivTrades said in a commentary.

Pandemic lockdowns have been expanding across China, including in Zhengzhou, where workers at a factor for Apple’s iPhone clashed with police earlier this week.

Across China, the number of new cases reported Thursday was 31,444, the highest since the virus was first detected in late 2019

In Asian trading, Japan’s benchmark Nikkei 225 jumped 1.0% to finish at 28,383.09. Australia’s S&P/ASX 200 added 0.1% to 7,241.80. South Korea’s Kospi gained nearly 1.0% to 2,441.33. Hong Kong’s Hang Seng rose 0.8% to 17,660.90, while the Shanghai Composite fell 0.3% to 3,089.31.

Minutes from the Federal Reserve’s most recent policy meeting showed central bank officials agreed that smaller rate hikes would likely be appropriate “soon.” That suggests policymakers are seeing signs that inflation may be cooling as the economy slows with more costly borrowing.

At their Nov. 1-2 meeting, Fed officials expressed uncertainty about how long it might take for their rate hikes to slow the economy enough to tame inflation. At a news conference afterward, Chair Jerome Powell stressed the Fed wasn’t even close to declaring victory in its fight to curb high inflation. Other Fed officials in the weeks since the meeting have signaled that additional hikes are still necessary.

The central bank’s benchmark rate currently stands at 3.75% to 4%, up from close to zero in March. It has warned that it may have to ultimately raise rates to previously unanticipated levels to cool the hottest inflation in decades.

Investors have been closely watching the latest economic and inflation data for any signs that might allow the Fed to ease up on future rate increases. Investors are worried that it could slam the brakes too hard on economic growth and bring on a recession.

In energy trading, benchmark U.S. crude lost 32 cents to $77.62 a barrel in electronic trading on the New York Mercantile Exchange. Brent crude, the international standard, fell 45 cents to $84.96 a barrel.

In currency trading, the U.S. dollar fell to 138.76 Japanese yen from 139.60 yen. The euro cost $1.0419 up from $1.0398.

Market Watch

ASX 200 futures up 10 points or 0.14% to 7265 at 07:57:55 AEDT

NYSE CLOSED THURSDAY FOR HOLIDAY

 

[bigdog]

US stocks wobble to a mixed close, indexes keep weekly gains

Stocks wobbled to a mixed close on Wall Street, but every major index notched weekly gains in a holiday-shortened week. The S&P 500 edged lower Friday.

apnews.com

US stocks wobble to a mixed close, indexes keep weekly gains​

By DAMIAN J. TROISE

Stocks wobbled to a mixed close on Wall Street Friday, but every major index notched weekly gains in a holiday-shortened week.

Investors faced a relatively quiet day, though concerns about inflation, high interest rates and a potential recession still hover over Wall Street. Markets were closed on Thursday for the Thanksgiving holiday and closed at 1 p.m. Eastern Friday.

The S&P 500 fell 1.14 points, or less than 0.1%, to close at 4,026.12. Nearly 70% of stocks in the benchmark index gained ground, but the broader market was dragged lower by technology companies. High valuations for companies in the technology sector tend to give it more heft in pushing the market higher or lower.

The Dow Jones Industrial Average rose 152.97 points, or 0.4%, to 34,347.03. The Nasdaq fell 58.96 points, or 0.5%, to 11,226.36.

U.S. crude oil prices fell and weighed down energy stocks.

Airlines and other travel-related companies gained ground as the busy holiday travel season kicks in. United Airlines rose 1.7%

Retailers were mixed as shoppers headed to stores for Black Friday. Home Depot rose 1.5% and Best Buy fell 1.4%.

Long-term bond yields were relatively stable but still hovered around multi-decade highs. The yield on the 10-year Treasury, which influences mortgage rates, rose to 3.70% from 3.69% late Wednesday.

Investors remain concerned about whether the Federal Reserve can tame the hottest inflation in decades by raising interest rates without going too far and causing a recession. The central bank’s benchmark rate currently stands at 3.75% to 4%, up from close to zero in March. It’s warned it may have to ultimately raise rates to previously unanticipated levels to rein in high prices on everything from food to clothing.

Minutes from the Fed’s latest policy meeting, released on Wednesday, show that officials agreed that smaller rate hikes would likely be appropriate “soon.” That was welcomed by investors who are worried that continued aggressive rate hikes could slow the already weak economy too much.

Investors also have their eyes on China’s lockdowns and restrictions to curb the spread of coronavirus infections, as the direction China takes will impact the rest of Asia and global supply chains.

China has been expanding pandemic lockdowns, including in a city where factory workers making Apple’s iPhone clashed with police this week, as its number of COVID-19 cases hit a daily record. Apple fell 2%.

Markets in Europe and Asia were mixed.

Wall Street gets several big economic updates next week. The Conference Board business group will release its November report on consumer confidence, which could give investors more insight on how consumers are dealing with inflation. The U.S. government also releases its closely watched monthly employment report.

The Dow Jones Industrial Average rose 152.97 points, or 0.4%, to 34,347.03. The Nasdaq fell 58.96 points, or 0.5%, to 11,226.36.

The S&P 500 fell 1.14 points, or less than 0.1%, to close at 4,026.12.

 

[bigdog]

Asian shares rise except Japan as markets eye China protests

Asian shares are trading mostly higher as market jitters decline over protests in China set off by growing public anger over COVID-19 restrictions.

apnews.com

US stock indexes fall as lockdown protests spread in China​

By DAMIAN J. TROISE and ALEX VEIGA

A broad slide on Wall Street left stocks lower Monday as global financial markets reacted to protests in China calling for President Xi Jinping to step down amid growing anger over severe COVID-19 restrictions.

The S&P 500 fell 1.5%, clawing back all of the benchmark index’s gains from last week. The Dow Jones Industrial Average finished 1.4% lower, while the Nasdaq composite slid 1.6%.

The world’s second largest economy has been stifled by a “zero COVID” policy which includes lockdowns that continually threaten the global supply chain at a time when recession fears hang over economies worldwide. The recent demonstrations there are the greatest show of public dissent against the ruling Communist Party in decades.

The unrest stoked worries on Wall Street that if Xi cracks down even further on dissidents there or expands the lockdowns, it could slow the Chinese economy, which would hurt oil prices and global economic growth, said Sam Stovall, chief investment strategist at CFRA

“A lot of people are worried about what the fallout will be, and basically are using that as an excuse to take some recent profits,” he said.

More than 90% of the stocks in the S&P 500 closed in the red, with technology companies the biggest weights on the broader market. Apple, which has seen iPhone production hit hard by lockdowns in China, fell 2.6%.

Banks and industrial stocks also were among the biggest drags on the market. JPMorgan fell 1.7% and Boeing slid 3.7%.

Several casino operators gained ground as the Chinese gambling haven of Macao tentatively renewed the their licenses. Las Vegas Sands rose 1.1% and Wynn Resorts gained 4.4%.

The fallout from the collapse of crypto exchange FTX continued. Cryptocurrency lender BlockFi is filing for Chapter 11 bankruptcy protection. Cryptocurrency exchange Coinbase Global fell 4% and the price of Bitcoin slipped 2.1%.

All told, the S&P 500 fell 62.18 points to 3,963.94. The Dow dropped 497.57 points to 33,849.46. The tech-heavy Nasdaq lost 176.86 points to close at 11,049.50.

Smaller company stocks fell even more that the broader market. The Russell 2000 slid 38.23 points, or 2.1%, to 1,830.96.

Markets in Asia and Europe fell. The yield on the 10-year Treasury held steady at 3.69%

Wall Street is coming off of a holiday-shortened week that was relatively light on corporate news and economic data. Investors have a busier week ahead as they continue monitoring the hottest inflation in decades and its impact on consumers, business and monetary policy.

Anxiety remains high over the ability of the Federal Reserve to tame inflation by raising interest rates without going too far and causing a recession. The central bank’s benchmark rate currently stands at 3.75% to 4%, up from close to zero in March. It has warned it may have to ultimately raise rates to previously unanticipated levels to rein in high prices on everything from food to clothing.

Federal Reserve Chair Jerome Powell will speak at the Brookings Institution about the outlook for the U.S. economy and the labor market on Wednesday.

The Conference Board will release its consumer confidence index for November on Tuesday. That could shed more light on how consumers have been holding up amid high prices and how they plan on spending through the holiday shopping season and into 2023.

The government will release several reports about the labor market this week that could give Wall Street more insight into one of the strongest sectors of the economy. A report about job openings and labor turnover for October will be released on Wednesday, followed by a weekly unemployment claims report on Thursday. The closely-watched monthly report on the job market will be released on Friday.

Market watch
ASX 200 futures up 10 points or 0.1% to 7251 at 6.48am AEDT

The S&P 500 fell 1.5%, clawing back all of the benchmark index’s gains from last week. The Dow Jones Industrial Average finished 1.4% lower, while the Nasdaq composite slid 1.6%

All told, the S&P 500 fell 62.18 points to 3,963.94. The Dow dropped 497.57 points to 33,849.46. The tech-heavy Nasdaq lost 176.86 points to close at 11,049.50

 

[bigdog]

Asian shares mostly decline ahead of Fed chair's key speech

Asian shares are trading mostly lower ahead of a closely watched speech by the Federal Reserve chief that may give clues about future interest rate hikes.

apnews.com

Wall Street ends an uneven day of trading with mixed results​

By DAMIAN J. TROISE and ALEX VEIGA

Wall Street capped an unsteady day of trading with an uneven finish for the major stock indexes Tuesday, as gains by energy companies were offset by losses in technology and other sectors.

The S&P 500 slipped 0.2%, its third straight drop. The tech-heavy Nasdaq composite fell 0.6%, while the Dow Jones Industrial Average ended just barely in the green and small-company stocks rose.

The mixed finish came as investors watched developments in China and looked ahead to a speech Wednesday by Federal Reserve Chair Jerome Powell for clues as to what the central bank will do next in its fight to lower stubbornly hot inflation.

Wall Street is especially eager to hear what Powell has to say after remarks on Monday by two Federal Reserve bank president s helped spur a broad sell-off for stocks.

“This is a market that’s waiting for more information, particularly from Powell,” said Quincy Krosby, chief equity strategist for LPL Financial.

The S&P 500 slipped 6.31 points to 3,957.63. The Nasdaq dropped 65.72 points to 10,983.78. The Dow, which had been down as much as 187 points, gained 3.07 points to close at 33,852.53.

The Russell 2000 index of small company stocks rose 5.59 points, or 0.3%, to 1,836.55.

Technology stocks were the biggest drag on the broader market. Apple fell 2.1%. Financial and industrial stocks were among the gainers. American Express added 2% and United Parcel Service rose 2.8%. Energy stocks rose as U.S. crude oil prices climbed 1.2%. Hess rose 1.8%.

Railroad operators rose amid hopes that a rail strike can be averted as Congress prepares to take up legislation this week to impose a deal that unions agreed to in September. Union Pacific rose 2% and CSX gained 1.8%.

Bond yields gained ground. The yield on the 10-year Treasury, which influences mortgage rates, rose to 3.76% from 3.68% late Monday.

Markets in Europe were mixed and markets in Asia rose broadly.

Hong Kong’s benchmark index jumped 5.2% as protests in China seemingly calmed down amid a heightened police presence in major cities and the government eases some of its lockdown restrictions.

China’s “zero-COVID” policy includes strict lockdown procedures that have crimped the nation’s economy and threaten global supply chains. That has added to broader concerns globally about stubbornly hot inflation and the potential for recessions to hit economies worldwide.

Wall Street’s big focus remains the Federal Reserve’s fight against the hottest inflation in decades. The central bank has been aggressively raising interest rates to make borrowing more difficult and tame high prices. The Fed’s benchmark rate currently stands at 3.75% to 4%, up from close to zero in March.

Investors have been hoping that the Fed could ease up on its rate increases and are closely watching the latest data on inflation, consumer spending and the employment market. They’ll be looking for any signs of a shift in policy when Powell speaks at the Brookings Institution about the outlook for the U.S. economy and the labor market on Wednesday

The Conference Board reported on Tuesday that consumer confidence fell slightly in November from October, but remains relatively strong. Consumer spending has been solid area of the economy, along with employment.

The U.S. government will be releasing several reports about the labor market this week. A report about job openings and labor turnover for October will be released Wednesday, followed by a weekly unemployment claims report Thursday. The closely watched monthly report on the job market will be released on Friday.

Market watch​

ASX 200 futures down 1 points to 7259 at 8.58am AEDT

The S&P 500 slipped 6.31 points to 3,957.63. The Nasdaq dropped 65.72 points to 10,983.78. The Dow, which had been down as much as 187 points, gained 3.07 points to close at 33,852.53.

The S&P 500 slipped 0.2%, its third straight drop. The tech-heavy Nasdaq composite fell 0.6%, while the Dow Jones Industrial Average ended just barely in the green and small-company stocks rose

 

[bigdog]

Asian shares gain after Fed chair signals slower rate hikes

Shares have advanced in Asia after a rally on Wall Street spurred by the chair of the Federal Reserve's comments on easing the pace of interest rate hikes to tame inflation.

apnews.com

Stocks rally after Fed chair signals slowdown in rate hikes​

By DAMIAN J. TROISE and ALEX VEIGA

Wall Street closed out a solid November with a broad market rally Wednesday after the head of the Federal Reserve said the central bank could soon begin easing up on its aggressive interest rate increases aimed at taming inflation.

Fed Chair Jerome Powell, speaking at the Brookings Institution, reaffirmed that the central bank could begin moderating its pace of rate hikes as soon as December, when the policymaking committee is due to hold its next meeting.

“We have a risk management balance to strike,” Powell said. “And we think that slowing down (on rate hikes) at this point is a good way to balance the risks.”

Stocks roared higher following Powell’s midafternoon remarks. The S&P 500 rose 3.1%, snapping a three-day losing streak. The Dow Jones Industrial Average gained 2.2% and the Nasdaq composite climbed 4.4%.

The major indexes ended November with their second straight month of gains, though they remain in the red for the year

Powell’s comments sent Treasury yields sharply lower. The yield on the 10-year Treasury dropped to 3.65% from 3.75% late Tuesday. The yield on the two-year note, which tends to track market expectations of future Fed action, fell to 4.34%. It was trading at 4.48% late Tuesday and had been as high as 4.53% shortly before Powell’s speech

While citing some recent signs that inflation is cooling, Powell stressed that the Fed will push rates higher than previously expected and keep them there for an extended period to ensure inflation comes down sufficiently.

“History cautions strongly against prematurely loosening policy,” Powell said. “We will stay the course until the job is done.”

“Perhaps all that the market was looking for today was confirmation that we’re going to have a smaller rate hike in December,” said Kristina Hooper, chief global market strategist at Invesco.

The path ahead, though, is far from certain.

“The only thing we know is that a smaller rate hike is likely in December,” she said. “We have really very little in the way of visibility of when the pause is going to be.”

Major indexes have been unsteady as the economy and financial markets deal with stubbornly hot inflation and the Fed’s attempt to cool high prices with aggressive interest rate increases

Wall Street has been hoping that the Fed will slow the scale and pace of its interest rate hikes. It has raised its benchmark interest rate six times since March, driving it to a range of 3.75% to 4%, the highest in 15 years. The goal is to make borrowing more difficult and generally slow the economy in order to tame inflation.

Those increases have helped send mortgage rates sharply higher, causing home sales to plunge, and it has raised costs for most other consumer and business loans. Many economists expect the U.S. will slip into a recession next year as higher borrowing costs slow economic activity.

In his remarks Wednesday, Powell said the Fed may increase its key interest rate by a smaller increment at its December meeting, only a half-point, after four straight three-quarter point hikes

“Cutting rates is not something we want to do soon,” Powell said. “That’s why we’re slowing down.”

Investors welcomed the prospect of more modest rate hikes.

More than 95% of the stocks in the benchmark S&P 500 index notched gains Wednesday, with technology companies leading the gains. Apple rose 4.9% and Microsoft jumped 6.2%.

All told, the S&P 500 rose 122.48 points to 4,080.11. The index gained 5.4% in November, but remains down about 14% so far this year.

The Dow climbed 737.24 points to close at 34,589.77, while the tech-heavy Nasdaq surged 484.22 points to 11,468.

Small company stocks also rallied. The Russell 2000 index rose 50.03 points, or 2.7%, to 1,886.58.

Markets in Asia and Europe closed mostly higher. U.S. crude oil prices climbed 3%.

The economy has been slowing, but contains strong pockets that have given markets hope that a recession could be avoided. The government on Wednesday said the economy grew at a 2.9% annual rate from July through September, an upgrade from its initial estimate.

Consumers have continued spending, despite of inflation squeezing wallets, and the overall employment market remains strong.

The employment market remains a big focus for the Fed and investors. It’s strength has helped the broader economy, but makes it more difficult to cool inflation.

“If we can get a weaker labor market, we’ll probably get weaker wage pressure,” said Scott Ladner, chief investment officer at Horizon Investments. “That’s sort of the last shoe to drop with inflation.”

Economic data on Wednesday showed signs of a softening labor market, though it remains relatively strong historically. The U.S. government reported that job openings dropped in October more than economists had anticipated. Human resources company ADP reported an easing in private sector employment growth in November.

Investors will get more data Thursday on the employment sector with a report on weekly unemployment claims. The closely watched monthly report on the job market will be released on Friday.

Market watch​

ASX 200 futures up 97 points or 1.34% to 7357 at 07:59:04am AEDT

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Get live ASX 200 futures quotes as well as live charts, historical data, technical analysis, and more.

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Stocks roared higher following Powell’s mid-afternoon remarks. The S&P 500 rose 3.1%, snapping a three-day losing streak. The Dow Jones Industrial Average gained 2.2% and the Nasdaq composite climbed 4.4%.

All told, the S&P 500 rose 122.48 points to 4,080.11. The index gained 5.4% in November, but remains down about 14% so far this year.

The Dow climbed 737.24 points to close at 34,589.77, while the tech-heavy Nasdaq surged 484.22 points to 11,468.

 

[bigdog]

Asian shares sink on revived worries over recession, China

Shares have retreated in Asia after a mixed day on Wall Street. Optimism over moves by China to ease strict pandemic controls faded, replaced by worries over data suggesting recession may be looming.

apnews.com

Wall Street ends mixed in an uneven start for December​

By DAMIAN J. TROISE and ALEX VEIGA

A day of wobbly trading on Wall Street ended Thursday with a mixed finish for stocks and bond yields broadly lower after the government reported that a measure of inflation that’s closely watched by the Federal Reserve eased in October.

The muted action came as traders looked ahead to a closely watched monthly report on the job market due out Friday that will show how the labor market is holding up and how that may influence what the Fed does next in its bid to cool inflation.

The S&P 500 closed 0.1% lower after drifting modestly higher and lower for much of the day. The Dow Jones Industrial Average fell 0.6% and the Nasdaq composite edged up 0.1%.

Banks and household goods providers were among the biggest drags on the benchmark S&P 500. Bank of America fell 2.9% and Costco slid 6.6%.

Gains in health care companies, communications services stocks and elsewhere in the market helped keep the losses in check. Drugmaker Pfizer rose 1.9% and Netflix climbed 3.7%.

Salesforce slumped 8.3% for the biggest drop in the S&P 500 after Bret Taylor said he would resign as co-CEO of the customer-management software developer.

Yields on both short-term and long-term bonds fell. The yield on the 10-year Treasury, which influences mortgage rates, edged lower to 3.51% from 3.61% late Wednesday. The yield on the two-year note, which tends to track market expectations of future Fed action, fell to 4.24%. from 4.33% a day earlier

All told, the S&P 500 dipped 3.54 points to 4,076.57. The Dow dropped 194.76 points to 34,395.01. The Nasdaq rose 14.45 points to 11,482.45.

The Russell 2000 index of small companies also took a step back, falling 4.90 points, or 0.3%, to close at 1,881.68.

Major indexes are coming off of their second straight month of gains. Markets rallied Wednesday after Fed Chair Jerome Powell indicated that the central bank could dial back the pace of its interest rate increases as soon as this month. The Fed has been aggressively raising interest rates in order to tame stubbornly hot inflation.

A measure of inflation that is closely monitored by the Fed eased in October. Wall Street has been closely watching any updates about inflation to get a better sense of whether the Fed will tone down its interest rate increases.

Powell said the central bank could begin moderating its pace of rate hikes at its next meeting in mid-December. The Fed, though, has been very clear about its intent to continue raising interest rates until it is sure that inflation is cooling.

The Fed has raised its benchmark rate six times since March, driving it to a range of 3.75% to 4%, the highest in 15 years. Wall Street expects the benchmark rate to reach a peak range of 5% to 5.25% by the middle of 2023.

A big concern for Wall Street has been whether the Fed can tame rates without sending the economy into a recession as it hits the brakes on growth. Businesses are seeing demand fall for a wide range of goods as inflation squeezes wallets. Analysts generally expect the U.S. to dip into a recession, even if it is mild and short, at some point in 2023

“What turns mild recessions into deep economic scarring is the buildup of excess, and we don’t have a bubble this time,” said Katie Nixon, chief investment officer for Northern Trust Wealth Management.

Inflation will continue to be the main focus for Wall Street, and “on that score, things seem to be coming off the boil,” she said.

Investors are also getting more data this week on inflation’s impact over the broader economy. Activity in the manufacturing sector contracted in November for the first time since May 2020, according to the Institute for Supply Management. The report also showed that prices are falling.

“All signs point to a deceleration of inflation in everything except wages,” Nixon said. “That is sort of the last man standing.”

Market watch​

ASX 200 futures down 12 points or 0.2% to 7354 at 6.45am AEDT

All told, the S&P 500 dipped 3.54 points to 4,076.57. The Dow dropped 194.76 points to 34,395.01. The Nasdaq rose 14.45 points to 11,482.45.

The S&P 500 closed 0.1% lower after drifting modestly higher and lower for much of the day. The Dow Jones Industrial Average fell 0.6% and the Nasdaq composite edged up 0.1%.

 

[bigdog]

Wall Street ends mixed following strong data on wages, jobs

Worries about inflation weighed on Wall Street, leaving major indexes mixed after another bumpy day of trading.

apnews.com

Wall Street ends mixed following strong data on wages, jobs​

By STAN CHOE and ALEX VEIGA

Worries about inflation weighed on Wall Street Friday, leaving major indexes mixed after a report showed wages for U.S. workers are accelerating, which is good news for them but could feed into even higher inflation for the nation.

The S&P 500 ended 0.1% lower after having been down as much as 1.2% earlier in the day. The Nasdaq composite also trimmed its deficit, falling 0.2%, while the Dow Jones Industrial Average eked out a 0.1% gain. The indexes all notched gains for the week.

Stocks had been on the upswing for the last month on hopes the worst of the nation’s high inflation may have passed already. That fed expectations for the Federal Reserve to dial down the intensity of its big interest-rate hikes. Such hikes aim to undercut inflation by slowing the economy and dragging down prices for stocks and other investments.

But Friday’s labor market report showed that wages for workers rose 5.1% last month from a year earlier. That’s an acceleration from October’s 4.9% gain and easily topped economists’ expectations for a slowdown.

Such jumps in pay are helpful to workers struggling to keep up with soaring prices for everyday necessities. The Federal Reserve’s worry is that too-strong gains could cause inflation to become further entrenched in the economy. That’s because wages make up a big part of costs for companies in services industries, and they could end up raising their own prices further to cover higher wages for their employees.

“Inflation is certainly moving in the right direction,” said Adam Abbas, co-head of fixed income at Harris Associates, “but the market is still going to have to go through some calibration of the risk that we level off at 3% to 4% core inflation versus a natural, steady move down to” the 2% goal set by the Fed.

“After such a strong move over the last three and a half weeks,” Abbas said about expectations for an easing up by the Fed, “maybe the market has gotten a little ahead of itself.”

Across the economy, employers added 263,000 jobs last month. That beat economists’ forecasts for 200,000, while the unemployment rate held steady at 3.7%. Many Americans also continue to stay entirely out of the job market, with a larger percentage of people either not working or looking for work than before the pandemic, which could increase the pressure on employers to raise wages

A labor market that remains much stronger than expected could make an already dicey situation for the Fed even more complicated. It’s trying to slow the economy just enough to prevent the buying activity that gives inflation its oxygen, without going so far as to create a recession. The Fed has signaled it will likely push the unemployment rate to at least 4.4% in its fight against inflation.

“The most important number for the Fed is probably the wage number,” said Brian Jacobsen, senior investment strategist at Allspring Global Investments.

Many traders are still betting on the Fed to downshift the size of its rate hikes at its next meeting later this month, as several officials at the central bank have hinted. Traders still largely expect the Fed to raise its key overnight interest rate on Dec. 14 by half a percentage point, after hiking by a heftier three-quarters of a point four straight times.

But expectations are rising for what the Fed will do in 2023. Treasury yields jumped immediately after the jobs report’s release on speculation the Fed may ultimately hike rates higher than thought a few moments before.

The yield on the two-year Treasury rose to 4.29% from 4.24% late Thursday. The 10-year yield, which helps set rates for mortgages and many other loans, fell to 3.49% from 3.51%.

“Another month with a strong jobs report and torrid wage gains is a reality check for where we stand in the inflation fight,” said Mike Loewengart, head of model portfolio construction at Morgan Stanley Global Investment Office.

The strong labor market data follows up on several mixed reports on the economy. The nation’s manufacturing activity shrank in November for the first time in 30 months, for example, while the housing industry is struggling under the weight of much higher mortgage rates. Such data points had raised hopes the Fed’s rate hikes were taking effect and would ultimately pull down inflation

Even though Friday’s report showed hiring was stronger than expected, it also clearly demonstrated that the nation’s downward trend in hiring is continuing. November’s jobs gains matched the low seen in April 2021, which was the weakest since December 2020 when the number of jobs shrank.

More economists are still forecasting the U.S. economy to fall into a recession next year in large part because of higher interest rates.

“While the Fed won’t back away from” a hike of just half a percentage point “in December, they still have no clue what they’ll do in 2023,” said Allpsring’s Jacobsen.

 

[bigdog]

Market watch​

ASX 200 futures are up 0.3 per cent to 7334 as investors await the Reserve Bank’s rates decision on Tuesday, with economists split between a 15 basis points or 25 basis points hike.

The S&P 500 ended 0.1% lower after having been down as much as 1.2% earlier in the day. The Nasdaq composite also trimmed its deficit, falling 0.2%, while the Dow Jones Industrial Average eked out a 0.1% gain. The indexes all notched gains for the week.

 

[bigdog]

Asian shares lower as strong data hit hopes for dovish Fed

Stocks are mostly lower in Asia after Wall Street pulled back as surprisingly strong economic reports highlighted the difficulty of the Federal Reserve’s fight against inflation.

apnews.com

Stocks slide as strong data suggests Fed has more to do​

By DAMIAN J. TROISE and ALEX VEIGA

Stocks closed broadly lower on Wall Street and Treasury yields rose Monday after surprisingly strong economic reports highlighted the Federal Reserve’s difficult fight against inflation.

The S&P 500 fell 1.8%, its third straight drop. The slide more than offset the index’s gains last week. The Dow Jones Industrial Average dropped 1.4% and the tech-heavy Nasdaq composite slid 1.9%. Small-company stocks fell even more, sending the Russell 2000 index 2.8% lower.

Bond yields mostly climbed. The yield on the 10-year Treasury, which influences mortgage rates, rose to 3.59% from 3.49% late Friday.

The selling came as traders reacted to some better-than-expected economic snapshots. The services sector, which makes up the biggest part of the U.S. economy, showed surprising growth in November, according to the Institute for Supply Management. Reports on business orders at U.S. factories and orders for durable goods in October also rose more than expected.

The reports are positive for the broader economy, but they make the Fed’s fight against inflation more difficult because it likely means the central bank will have to keep raising interest rates in order to bring down inflation.

“It’s more of that ‘good news is bad news,’” said Tom Martin, senior portfolio manager at Globalt Investments. The latest economic data “bolsters the idea that rates are going to be higher.”

Meanwhile, China is lifting some of its most severe COVID-19 restrictions following protests across major cities. That has raised hopes that disruptions to manufacturing and trade will ease.

The S&P 500 fell 72.86 points to 3,998.84. The Dow dropped 482.78 points to 33,947.10. The Nasdaq slid 221.56 points to 11,239.94. The Russell 2000 fell 52.62 points to 1,840.22.

All told, roughly 95% of the stocks in the benchmark S&P 500 index were in the red, with technology companies, banks and retailers among the biggest weights on the market. Chipmaker Nvidia fell 1.6%, Bank of America slid 4.5% and Amazon dropped 3.3%.

V.F. Corp., which makes Vans shoes and The North Face outdoor gear, slid 11.2% for the biggest drop in the S&P 500 after warning investors that weak demand is crimping revenue. The company also announced the departure of its CEO

Tesla fell 6.4% following reports that it may have to cut production in China because of weak demand.

Markets in Asia rose, while markets in Europe closed mostly lower.

Inflation, rising interest rates and the potential for recessions throughout global economies are among the biggest concerns for investors. Wall Street has been closely watching corporate announcements and government reports to get a better sense of just how much damage is being done to the economy, as well as inflation’s path ahead in 2023.

Investors are also weighing several international developments that could further unsettle a global economy that is already getting burned by stubbornly hot inflation.

Russia’s ongoing invasion of Ukraine continues agitating an already volatile global energy market. U.S. crude oil prices bounced around before settling 3.8% lower after a group of world leaders agreed to a boycott of most Russian oil. They also committed to a price cap of $60 per barrel on Russian exports

Oil and gas company stocks fell amid a broad pullback in energy prices, including an 11.2% slump in natural gas. Exxon Mobil fell 2.7%.

Investors are dealing with several crosscurrents of information. Demand may be weakening in some areas of the economy, but some sectors remain resilient. Employment remains a strong area of the economy as does overall consumer spending.

Wall Street will get a weekly update on unemployment claims on Thursday. Investors will likely be more focused on the monthly report on producer prices, for November, from the government on Friday.

The Fed has been aggressively raising its benchmark interest rate in an effort to tame inflation. The strategy is intended to make borrowing more expensive and generally hit the brakes on consumer spending and the economy. The risk is that the policy could send the economy into a recession.

The Fed is in a very “hawkish, but awkward” position, said Gene Goldman, chief investment officer at Cetera Investment Management.

“All of this is playing into uncertainty,” he said.

The Fed is meeting next week and is expected to raise interest rates by a half-percentage point, which would mark an easing of sorts from a steady stream of three-quarters of a percentage point rate increases. It has raised its benchmark rate six times since March, driving it to a range of 3.75% to 4%, the highest in 15 years. Wall Street expects the benchmark rate to reach a peak range of 5% to 5.25% by the middle of 2023.

Market watch​

The S&P/ASX 200 futures was poised to open 23.0 points or 0.31% lower @ 7,297.5, according to ASX futures @ 07:59:01.

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Get live ASX 200 futures quotes as well as live charts, historical data, technical analysis, and more.

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The S&P 500 fell 1.8%, its third straight drop. The slide more than offset the index’s gains last week. The Dow Jones Industrial Average dropped 1.4% and the tech-heavy Nasdaq composite slid 1.9%. Small-company stocks fell even more, sending the Russell 2000 index 2.8% lower.

The S&P 500 fell 72.86 points to 3,998.84. The Dow dropped 482.78 points to 33,947.10. The Nasdaq slid 221.56 points to 11,239.94. The Russell 2000 fell 52.62 points to 1,840.22.

 

[bigdog]

Stocks decline in Asia, extending losses on Wall Street

Shares are lower in Asia after benchmarks fell again on Wall Street on fears the Federal Reserve will need to keep the brakes on the economy to get inflation under control, risking a sharp recession.

apnews.com

Stocks fall again on Wall Street, extending recent losses​

By DAMIAN J. TROISE and ALEX VEIGA

Stocks closed broadly lower on Wall Street Tuesday, extending the market’s recent string of losses, as traders ponder the Federal Reserve’s next moves in its campaign to cool stubbornly hot inflation.

The S&P 500 fell 1.4%, its fourth straight drop. The Dow Jones Industrial Average fell 1% and the Nasdaq composite lost 2%.

Technology stocks, communication companies and retailers had some of the biggest losses. Apple fell 2.5%, Disney slid 3.8% and AutoZone dropped 2.8%.

Small company stocks also fell, pulling the Russell 2000 index 1.5% lower. The major indexes are on pace for a weekly loss after posting two straight weekly gains.

Bond yields fell. The yield on the 10-year Treasury slid to 3.52% from 3.58% late Monday.

European markets ended mostly lower and Asian markets closed mixed.

Several companies made big moves following financial updates and buyout announcements.

Utility NRG Energy slumped 15.1% after announcing it is spending $2.8 billion in cash and assuming $2.4 billion in debt to buy Vivint Smart Home

Jewelry company Signet vaulted 20.2% after raising its profit and revenue forecasts for the year.

Roughly 80% of stocks in the S&P 500 fell, leaving the benchmark index down 57.58 points to 3,941.26. The Dow dropped 350.76 points to 33,596.34, while the tech-heavy Nasdaq lost 225.05 points to close at 11,014.89.

The Russell 2000 slid 27.65 points to 1,812.58.

The broader market’s dip comes a day after stocks pulled back as stronger-than-expected readings on the economy raised worries that the Fed has a ways to go in getting inflation under control. The Fed is doing that by intentionally slowing the economy with higher interest rates.

“We’ve been in this period where investors have been anticipating now that the Fed will back off pretty soon, they’ll pause soon and probably even start cutting rates in the back half of 2023,” said Bill Merz, head of capital market research at U.S. Bank Wealth Management.

“And then when we get the occasional robust jobs report and inflation report that makes it clear that inflation remains quite problematic and it’s not decelerating as quickly as anyone would like,” Merz said.

Investors are closely watching economic data and company announcements to get a better sense of how the economy is handling stubbornly hot inflation. They are also trying to determine whether inflation is easing at a pace that will allow the Fed to ease up on interest rate increases. The Fed’s policy risks hitting the brakes on the economy too hard and sending it into a recession.

The Fed is meeting next week and is expected to raise interest rates by a half-percentage point. It has raised its benchmark rate six times since March, driving it to a range of 3.75% to 4%, the highest in 15 years. Wall Street expects the benchmark rate to reach a peak range of 5% to 5.25% by the middle of 2023.

Wall Street will get a weekly update on unemployment claims on Thursday. The job market has been one of the stronger pockets in the economy.

Investors will get important updates on inflation and how consumers are dealing with high prices later in the week

On Friday, the government will release its November report on producer prices. That will give investors more insight into how inflation is impacting businesses.

The University of Michigan will release its December survey on consumer sentiment on Friday.

With growing concerns about a recession, Fitch Ratings revised its forecasts for world economic growth downward to reflect the Fed’s and other central banks’ interest rate hikes.

The ratings agency’s Global Economic Outlook report estimated global growth at 1.4% in 2023, revised down from 1.7% in its September forecast. It put U.S. growth in 2023 at 0.2%, down from 0.5%, as the pace of monetary policy tightening increases.

Market watch​

ASX 200 futures are down 36 points or 0.5 per cent to 7255 as local investors await the release of September quarter GDP data.

The S&P 500 fell 1.4%, its fourth straight drop. The Dow Jones Industrial Average fell 1% and the Nasdaq composite lost 2%

Roughly 80% of stocks in the S&P 500 fell, leaving the benchmark index down 57.58 points to 3,941.26. The Dow dropped 350.76 points to 33,596.34, while the tech-heavy Nasdaq lost 225.05 points to close at 11,014.89.

 

[bigdog]

Asian shares slip after tech stock slump on Wall St

Shares are mostly lower in Asia after Wall Street sagged under weakness in tech stocks. Japan revised upward its GDP data to show the economy contracted less than earlier reported in July-September.

apnews.com

Slump in tech stocks helps send Wall Street to another loss​

By DAMIAN J. TROISE and ALEX VEIGA

Wall Street ended a wobbly day of trading with more losses Wednesday, as a slide in technology companies helped pull stocks lower and Treasury yields fell broadly.

The S&P 500 slipped 0.2%, its fifth straight loss. The Nasdaq composite, which is heavily weighted with tech stocks, fell 0.5%, while the Dow Jones Industrial Average finished just barely in the green.

Treasury yields fell significantly. The yield on the 10-year Treasury, which influences mortgage rates, slid to 3.42% from 3.53% late Tuesday. The two-year Treasury yield, which tends to track market expectations of future action by the Federal Reserve, fell to 4.27% from 4.36%.

Investors have been dealing with a relative lack of news ahead of updates on inflation and consumer sentiment later this week, and the Federal Reserve’s meeting next week. Inflation, the Fed’s aggressive interest rate increases and recession worries remain the big concerns for Wall Street.

“Investors continue to position for rates to go higher for longer,” Sam Stovall, chief investment strategist at CFRA.

The S&P 500 slipped 7.34 points to 3,933.92. The Nasdaq fell 56.34 points to 10,958.55. The Dow managed a 1.58 point gain, essentially flat, at 33,597.92.

Small company stocks also edged lower. The Russell 2000 index fell 5.67 points, or 0.3%, to 1,806.90.

Every major index is on track for weekly losses.

Technology and communication services stocks were the biggest weights on the benchmark S&P 500 index. Apple fell 1.4% and Google parent Alphabet dropped 2.1%.

Health care stocks were among the few bright spots. Pfizer rose 1.1%.

Investors rewarded several companies for solid earnings reports. Campbell Soup rose 6% after reporting strong results.

Carvana plunged 42.9%, its biggest single-day drop on record, after analysts at Wedbush Securities warned that the used vehicle chain’s bankruptcy risk is rising. The company has lost 98% of its value since the beginning of the year.

U.S. crude oil prices fell 3%, settling at $72.01 per gallon, the lowest price this year.

Economic updates later this week could give investors more insight into inflation’s path ahead and how the Fed will continue fighting high prices.

The U.S. will release data on weekly unemployment claims on Thursday. The jobs market has been a strong area of the otherwise slowing economy and that has made it more difficult for the Fed to tame inflation.

The government will release a report on wholesale prices Friday that will provide more details on how inflation is affecting businesses. The University of Michigan will release a December survey on consumer sentiment on Friday.

The reports do not typically move markets but are receiving elevated attention as they are some of the final data dumps before the Fed meets next week.

The central bank is expected to raise interest rates by a half-percentage point at its meeting next week. It has raised its benchmark rate six times since March, driving it to a range of 3.75% to 4%, the highest in 15 years. Wall Street expects the benchmark rate to reach a peak range of 5% to 5.25% by the middle of 2023

Inflation has been easing and economists expect the upcoming data on wholesale and consumer prices to reflect that trend. The pace has been slow, though, and the Fed has been very clear about its intent to keep raising interest rates until it is sure that inflation is cooling. That has raised concerns that the central bank could hit the brakes too hard on the economy and cause a recession.

A growing number of analysts expect the U.S. economy to slip into a recession in 2023, but are unsure of its potential severity and duration.

European markets mostly fell. Markets in Asia closed lower overnight. China rolled back more of its strict COVID-19 rules that have hindered that nation’s economy and added more uncertainty to global supply chains.

Market watch​

ASX 200 futures down 18 points or 0.35% to 7228 at 6.35am AEDT

The S&P 500 slipped 7.34 points to 3,933.92. The Nasdaq fell 56.34 points to 10,958.55. The Dow managed a 1.58 point gain, essentially flat, at 33,597.92.

The S&P 500 slipped 0.2%, its fifth straight loss. The Nasdaq composite, which is heavily weighted with tech stocks, fell 0.5%, while the Dow Jones Industrial Average finished just barely in the green.

 

[bigdog]

Asian shares advance on back of Wall Street gains

Shares are higher in Asia after an advance on Wall Street led by the latest rally in technology companies.

apnews.com

Stocks rise on Wall Street, but remain lower for the week​

By DAMIAN J. TROISE and ALEX VEIGA

Technology companies helped lift stocks Thursday, ending a five-day losing streak for the S&P 500, though the major indexes remain on pace for a weekly loss.

The S&P 500 rose 0.8%, while the tech-heavy Nasdaq composite closed 1.1% higher. The Dow Jones Industrial Average added 0.5%.

Major indexes are all in the red for the week and have been swinging between big monthly gains and losses throughout the year. Investors’ worries about inflation, rising interest rates and recession risks have made for a volatile market. That has also left Wall Street focused on data points on the economy, especially those regarding inflation.

“We’ll continue to see outsized moves in the markets over the coming months,” said Jeff Kleintop, chief global investment strategist at Charles Schwab. “We’re going to be feeling our way through and there’s going to be a lot of volatility.”

The S&P 500 rose 29.59 points to 3,963.51. The Nasdaq gained 123.45 points to 11,082, and the Dow rose 183.56 points to 33,781.48.

Tech stocks powered much of the rally, along with health care companies and retailers. Chipmaker Nvidia climbed 6.5%, Pfizer rose 3.1% and Nike gained 2.8%.

Communication services stocks posted some of the biggest losses. T-Mobile US slid 3.3%

Energy stocks also fell. The price of U.S. crude oil settled 0.8% lower at $71.46 per barrel, another low point for the year. ConocoPhillips dropped 2%.

Activision Blizzard lost 1.5% after the Federal Trade Commission said it is suing to block Microsoft’s planned $69 billion takeover of the video game company, saying it could suppress competitors to its Xbox game consoles and its growing games subscription business. Microsoft rose 1.2%.

Small company stocks gained ground. The Russell 2000 index added 11.39 points, or 0.6%, to 1,818.29.

Bond yields mostly rose. The yield on the 10-year Treasury note, which helps set mortgage rate s, increased to 3.49% from 3.42% late Wednesday.

Markets in Europe closed mostly lower, while markets in Asia ended mixed.

On Thursday, the U.S. reported slightly more Americans filed for jobless claims last week, but not as many as economists had forecast. The labor market remains one of the strongest pockets of the economy, which has been stifled under the weight of stubbornly hot inflation and rising interest rates.

Low unemployment is good for the broader economy but makes it more difficult for the Federal Reserve to tame inflation. The central bank has been raising interest rates to curb borrowing and spending in order to cool stubbornly hot inflation in decades. Its benchmark interest rate sits at 3.75% to 4%, the highest in 15 years.

The Fed will meet next week and is expected to raise its benchmark interest rate by a half-percentage point.

Resilient consumer spending, which is partly tied to strong employment, has also made the fight against inflation more difficult. It has been keeping the economy strong enough to stay out of a recession, analysts have said, but it is also increasing the chances that the Fed will go too far in raising interest rates. The Fed could potentially cause a recession by hitting the brakes too hard on the economy

Wall Street will get more insight into how consumers feel about inflation and the economy on Friday when the University of Michigan releases its consumer sentiment survey for December. Investors will also get an update on how inflation is impacting businesses when the government releases its latest monthly report on wholesale prices Friday.

Market watch​

The S&P/ASX 200 will open 33 points or 0.46 per cent higher this morning, according to futures moves

The S&P 500 rose 29.59 points to 3,963.51. The Nasdaq gained 123.45 points to 11,082, and the Dow rose 183.56 points to 33,781.48.

The S&P 500 rose 0.8%, while the tech-heavy Nasdaq composite closed 1.1% higher. The Dow Jones Industrial Average added 0.5%.

 

[bigdog]

Wall Street falls as US inflation slows but remains hot

Stocks closed lower on Wall Street after a report showed inflation is slowing, though not by as much as hoped.

apnews.com

Wall Street falls as US inflation slows but remains hot​

By STAN CHOE and ALEX VEIGA

A choppy day of trading on Wall Street ended with stocks broadly lower Friday, after a new report showed that inflation is slowing less than hoped just days before Federal Reserve officials are expected to raise interest rates again.

The S&P 500 and Nasdaq composite each fell 0.7%, while the Dow Jones Industrial Average dropped 0.9%. Smaller company stocks fell even more, pulling the Russell 2000 index 1.2% lower. The indexes marked their first losing week in the last three.

The U.S. government reported that prices paid at the wholesale level were 7.4% higher in November than a year earlier. That’s a slowdown from October’s wholesale inflation rate of 8.1%, but it was still slightly worse than economists expected.

“There’s a sense that inflation has plateaued, but that said it’s still sticky and the Fed is most likely going to have to push harder,” said Quincy Krosby, chief equity strategist for LPL Financial

The nation’s high inflation, along with the Federal Reserve’s economy-crunching response to it, have been the main reasons for Wall Street’s painful tumble this year. Stocks have recovered some of their losses recently, as inflation has slowed since hitting a peak in the summer. But it remains too high, raising the risk the Federal Reserve will have to keep hiking interest rates sharply to get it fully under control

Treasury yields climbed as traders stepped up bets for how high the Fed will ultimately take interest rates. The central bank has already hiked its key overnight rate to a range of 3.75% to 4%, up from basically zero as recently as March.

Its next decision on rates is scheduled for next week, and the general expectation is for it to raise rates by another half of a percentage point.

Friday’s economic data did not sway Wall Street’s expectations on that, not after several Fed officials hinted recently they may step down from their string of four straight hikes of 0.75 percentage points. Such a dial down would mean less added pressure on markets and the economy. Even so, the Fed has said it may still take rates higher than markets expect before taking a pause.

Higher rates hurt the economy by making it more expensive for companies and households to borrow money, which forces them to cut back on spending. If rates go too high, it can cause a recession. They also drag down on prices for stocks and all kinds of other investments

A separate report on Friday showed U.S. households are paring expectations a bit for inflation in the future. That’s key for the Fed, which wants to prevent a vicious cycle where households rush to make purchases on fears prices will rise further. Such buying activity only fans inflation higher.

Households are forecasting inflation of 4.6% in the year ahead, according to the survey by the University of Michigan. That’s the lowest such reading in 15 months, though still well above where it was two years ago. Expectations for longer-run inflation remain stuck in the 2.9% to 3.1% range where they’ve been for 16 of the last 17 months, at 3%.

Overall sentiment among consumers was also stronger than economists expected, according to the University of Michigan’s preliminary reading. That’s good news for the economy, which gets most of its strength from spending by such consumers. But it can also complicate the Fed’s task. If such spending remains resilient, it could keep up the pressure on inflation.

The last big piece of data on inflation before the Fed’s next decision arrives on Tuesday, when economists expect the consumer price index to show that inflation slowed to 7.3% last month from 7.7% in October.

“The two most important questions for next year are how fast inflation will drop and how much will it need to drop for the Fed to stop tightening,” foreign-exchange strategists wrote in a BofA Global Research report. “We are concerned markets too optimistic on both.”

Roughly 75% of the stocks in the S&P 500 closed lower Friday, with health care, technology and energy among the sectors that weighed down the market most. The benchmark index fell 29.13 points to 3,934.38. It finished 3.4% lower for the week and is now down 17.5% this year

The Dow fell 305.02 points to 33,476.46, while the Nasdaq slid 77.39 points to 11,004.62. The Russell 2000 dropped 21.63 points to 1,796.66.

The yield on the two-year Treasury, which tends to track expectations for Fed action, rose to 4.36% from 4.26% just before Friday’s inflation report was released. It was at 4.31% late Thursday.

The yield on the 10-year Treasury, which helps dictate rates for mortgages and other loans, rose to 3.58% from 3.49% late Thursday.

In overseas stock markets, European indexes closed higher after recovering from a pullback following the U.S. inflation report.

Chinese benchmarks rose Friday on reports the government is planning new measures to support the ailing property sector, which has been a severe drag on growth over the past several years.

The relaxation of some of China’s “zero-COVID” rules is also raising hopes the economy will gain momentum, though experts say it will take months for tourism and other business to recover from the disruptions of the pandemic. It historically has been a major source of the global economy’s growth.

 

[bigdog]

Market watch​

ASX futures down 35 points or 0.5% to 7183 on Saturday

The Dow fell 305.02 points to 33,476.46, while the Nasdaq slid 77.39 points to 11,004.62. The Russell 2000 dropped 21.63 points to 1,796.66.

The S&P 500 and Nasdaq composite each fell 0.7%, while the Dow Jones Industrial Average dropped 0.9%.

 

[bigdog]

Asian shares mostly higher ahead of Fed rate hike decision

Asian shares are mostly higher as the Federal Reserve and other central banks prepare for the year’s final barrage of interest rate hikes.

apnews.com

Wall Street rises ahead of year’s last barrage of rate hikes​

By STAN CHOE and ALEX VEIGA

Stocks closed higher Monday as Wall Street kicked off a busy week when central banks are likely to unload the year’s final barrage of interest-rate hikes meant to drive down the world’s painfully high inflation.

The S&P 500 rallied 1.4%, trimming its loss for the year to 16.3%. The Dow Jones Industrial Average rose 1.6% and the Nasdaq composite gained 1.3%. Small company stocks also rose, pushing the Russell 2000 index 1.2% higher. The indexes are coming off their first weekly loss in three weeks.

The gains were widespread, with more than 90% of stocks in the benchmark S&P 500 index closing higher. Treasury yields rose broadly.

The market rally comes ahead of a key inflation report on Tuesday and a meeting of policymakers at the Federal Reserve, after which investors expect the Fed to announce Wednesday its last rate hike of the year following a blitzkrieg that began in March.

“Tomorrow, the inflation data is pretty important because we’ve been getting some decent reads,” said Tom Martin, senior portfolio manager at Globalt Investments. “Not to say that inflation has been coming down by leaps and bounds, but sort of at the margin it looks as though prices are getting a little bit weaker.”

The main reasons for Wall Street’s struggles much of this year have been high inflation and the higher interest rates engineered to combat it.

Higher rates slow the economy by design and risk causing a recession if they go too high, all while dragging down prices of investments. One upside for investors is that the Fed has hinted it will dial down the size of its rate hikes, leading to expectations for a more modest increase of 0.50 percentage points Wednesday.

That would follow four straight mega-hikes of 0.75 percentage points. Each was triple the Fed’s usual move, and they lifted the central bank’s key overnight rate to a range of 3.75% to 4% after starting the year at virtually zero.

Other central banks around the world are also likely to raise their own rates by half a percentage point this week, including the European Central Bank.

Any dial down in the size of rate hikes would mean less added pain for markets and the economy. Such hopes have helped stocks and bonds rally since mid-October, as investors have taken data reports to mean the worst of inflation has finally passed and would allow the Fed to ease up.

But expectations for a slowdown in rate hikes may also be setting some investors up for disappointment, if central banks signal this week they’ll ultimately take rates higher than markets expect. While they aren’t the clear majority of the market, many traders are betting the Fed’s overnight interest rate will top out at a range of 4.75% to 5% next year, for example.

Economists at Goldman Sachs expect Fed policy makers on Wednesday to signal their median expectation is for rates to hit a range of 5% to 5.25%, up by half a percentage point from their last projection.

Some investors also continue to make moves in anticipation of the Fed cutting interest rates during the second half of 2023. Rate cuts generally act like steroids for stocks and other investments, but the Fed has been insisting it plans to hold rates at a high level for some time to ensure the battle against inflation is won.

Even if inflation is indeed on its way down, the global economy still faces threats from the rate increases already pushed through. The housing industry and other businesses that rely on low interest rates have shown particular weakness, and worries are rising about the strength of corporate profits broadly.

“Inflation Data and Fed Is Yesterday’s News; Focus on Earnings Risk” was the title of a report published Monday by strategists at Morgan Stanley.

The next big milestone for markets comes Tuesday, when the U.S. government releases the latest update on inflation at the consumer level. Economists forecast that inflation slowed to 7.3% last month from 7.7% in October.

Besides raising short-term rates, the Fed is also making other moves with its vast trove of bond investments that should effectively allow longer-term yields to rise.

The yield on the 10-year Treasury, which helps set rates for mortgages and other loans, rose to 3.61% from 3.59% late Friday. The two-year yield, which tends to more closely track expectations for the Fed, rose to 4.39% from 4.34%.

Technology stocks accounted for a big share of the market’s gains. Microsoft rose 2.9% and was the biggest single force lifting the S&P 500. The London Stock Exchange Group agreed to a 10-year deal where it will move data to Microsoft’s cloud and spend at least $2.8 billion. Microsoft is also taking a 4% ownership stake in the company.

Horizon Therapeutics jumped 15.5% after Amgen announced it would acquire the biopharmaceutical company for about $26.4 billion.

Energy producers also rose after the price of U.S. oil settled 3% higher. Exxon Mobil rose 2.5%.

Last week, crude prices scraped their lowest levels of the year on worries about a weakening global economy, which would mean less demand for energy

All told, the S&P 500 rose 56.18 points to 3,990.56. The Dow added 528.58 points to close at 34,005.04. The Nasdaq climbed 139.12 points to 11,143.74. The Russell 2000 gained 21.95 points to 1,818.61

Market watch​

The S&P/ASX 200 is poised to open 49 points or 0.68 per cent higher, according to futures moves.

The S&P 500 rose 56.18 points to 3,990.56. The Dow added 528.58 points to close at 34,005.04. The Nasdaq climbed 139.12 points to 11,143.74. The Russell 2000 gained 21.95 points to 1,818.61

The S&P 500 rallied 1.4%, trimming its loss for the year to 16.3%. The Dow Jones Industrial Average rose 1.6% and the Nasdaq composite gained 1.3%.

 

[bigdog]

Asian shares track Wall St gains on cooler inflation data

Stocks are higher in Asia after a rally on Wall Street spurred by news that inflation in the U.S. cooled more than expected last month.

apnews.com

Wall Street closes higher after inflation cooled in November​

By STAN CHOE, DAMIAN J. TROISE and ALEX VEIGA

Stocks on Wall Street finished higher Tuesday after a report showed inflation cooled more than expected last month, cementing expectations that the Federal Reserve is about to dial down the size of its interest rate hikes.

The encouraging inflation data raised hopes for easing pressure on the economy ahead of an interest rate policy update on Wednesday from the Fed. Stocks initially surged, driving the Dow Jones Industrial Average more than 700 points higher, but then pared their gains as analysts cautioned investors not to get carried away by hopes for an easier Fed, as they have in the past.

The S&P 500 ended 0.7% higher. An early-morning burst of 2.8% nearly vanished by lunchtime. It had already climbed 1.4% a day earlier, with much of that gain coming in the last hour of trading on anticipation of the inflation data.

The Dow Jones Industrial Average flipped briefly to a loss before ending 0.3% higher, while the Nasdaq composite rose 1% after shedding most of a 3.8% gain.

The source of all the action was data showing that U.S. inflation slowed to 7.1% last month from 7.7% in October and more than 9% in the summer. Even though inflation remains painfully high, and shoppers continue to pay prices well above levels from a year ago, Tuesday’s report offers hope that the worst of inflation really did pass during the summer.

More importantly for markets, the slowdown bolstered investors’ expectations that the Federal Reserve will downshift to an increase of 0.50 percentage points when it announces its next hike to short-term rates on Wednesday.

“The market’s hanging onto what the Fed does,” said Michael Antonelli, market strategist at Baird, adding that Wall Street will be watching whether Fed officials acknowledge the latest evidence of declining inflation.

“Will that be part of their language?” he said. “And if they say, ‘yes, we see it, but that doesn’t change our mind at all,’ then they’ve told us that they still think they need to hike or that they need to stay at higher rates for longer.”

Such increases slow the economy by design, in hopes of cooling conditions enough to get inflation under control. But they also risk causing a recession if rates go too high, and they push down on prices for stocks and all kinds of other investments in the meantime. Smaller hikes to interest rates would mean less added pain to both the economy and to markets.

A hike of 0.50 percentage points would usually be a big deal because it’s double the typical move. But with inflation coming off its worst level in generations, it would be a step down from the four straight mega-hikes of 0.75 percentage points the Fed has approved since the summer.

Expectations for an easier Fed meant some of Wall Street’s wildest action Tuesday was in the bond market, where yields fell sharply immediately after the inflation report’s release.

The yield on the 10-year Treasury, which helps set rates for mortgages and other important loans, fell to 3.51% from 3.62% late Monday. The two-year yield, which more closely tracks expectations for the Fed, dropped to 4.22% from 4.39%

Other central banks around the world, including the European Central Bank, are also likely to raise their own rates by half a percentage point this week.

Technology stocks helped push the S&P 500 higher. The benchmark index added 29.09 points to close at 4,019.65. The Dow rose 103.60 points to 34,1087.64. The Nasdaq gained 113.08 points to finish at 11,256.81.

Small company stocks also gained ground. The Russell 2000 index rose 13.75 points, or 0.8%, to 1,832.36.

Despite the encouraging data, analysts cautioned that the Federal Reserve’s fight against inflation — and its hikes to interest rates — still has further to go. Even if the Fed is moving at smaller increments each time, it may still ultimately take rates higher than markets expect.

“That downshift should not be conflated with a pivot,” said Jake Jolly, senior investment strategist at BNY Mellon Investment Management. “It’s going to be a bumpy, long slog and probably going to take most of next year.”

Some investors continue to bet the Fed will cut interest rates in the latter part of 2023. Rate cuts generally act like steroids for stocks and other investments, but the Fed has been insisting it plans to hold rates at a high level for some time to ensure the battle against inflation is won.

And even if inflation is indeed firmly on its way down, the global economy still faces threats from the rate increases already pushed through. The housing industry and other businesses that rely on low interest rates have shown particular weakness, and worries are rising about the strength of corporate profits broadly.

Still, such caution wasn’t enough to erase all of the relief that washed through Wall Street as economists called the inflation data “cool” in more ways than one.

A measure of fear among stock investors, which shows how much they’re paying for protection from upcoming swings in prices, eased by more than 9%.

Market watch​

The S&P/ASX 200 is poised to open 16 points or 0.22 per cent ahead, according to futures moves. The Australian benchmark rallied yesterday for only the second time in six sessions, gaining 0.31 per cent.

The Dow Jones Industrial Average flipped briefly to a loss before ending 0.3% higher, while the Nasdaq composite rose 1% after shedding most of a 3.8% gain.

Technology stocks helped push the S&P 500 higher. The benchmark index added 29.09 points to close at 4,019.65. The Dow rose 103.60 points to 34,1087.64. The Nasdaq gained 113.08 points to finish at 11,256.81.

 

[bigdog]

Asia stocks follow Wall St down as Fed warns of higher rates

Asian shares have skidded after a retreat on Wall Street as markets showed dismay over the Federal Reserve's warning that more interest rate hikes are in store following its latest increase.

apnews.com

Stocks stumble after Fed hikes rates, signals more to come​

By DAMIAN J. TROISE and ALEX VEIGA

A bumpy day of trading on Wall Street ended with stocks broadly lower Wednesday after Federal Reserve raised its benchmark interest rate in its fight against inflation and signaled that more hikes lay ahead.

As expected, the central bank raised its key short-term rate by 0.50 percentage points, marking its seventh hike this year. The Fed also said it expected to raise rates higher over the coming few years than it had previously anticipated.

The S&P 500 lost 0.6% after giving up an earlier gain of 0.9%. The Dow Jones Industrial Average fell 0.4% and the Nasdaq composite gave back 0.8%. Bond yields mostly fell after a brief rally following the Fed’s midafternoon announcement.

“The market was expecting the Fed to tone down its hawkishness, which it did not,” said Sam Stovall, chief investment strategist at CFRA.

The Fed’s latest hike is smaller than the previous four 0.75 percentage point increases and comes a day after an encouraging report showed that inflation in the U.S. slowed in November for a fifth straight month

Recent signs that inflation, while still painfully high, has eased had stoked optimism on Wall Street that the Fed might signal the possibility of rate cuts in the second half of next year. But during a press conference following the Fed’s latest policy announcement, Fed Chair Jerome Powell emphasized that the full effects of the central bank’s efforts to slow the economy to bring down inflation have yet to be fully felt.

“The inflation data received so far for October and November show a welcome reduction in the monthly pace of price increases, but it will take substantially more evidence to give confidence that inflation is on a sustained downward path,” Powell said.

Powell also reiterated that the Fed plans to hold rates at a level high enough to slow the economy “for some time” to ensure inflation really is crushed. He said the Fed’s projections released Wednesday do not include any for rate cuts in 2023.

“I wouldn’t see the committee cutting rates until we’re confident that inflation is moving down in a sustained way,” Powell said.

He also said that how fast the Fed raises rates is not so important now. “It’s far more important to think what is the ultimate level,” Powell said

The latest increase brings the Fed’s federal funds rate to a range of 4.25% to 4.5%, its highest level in 15 years. Fed policymakers forecast that the cental bank’s rate will reach a range of 5% to 5.25% by the end of 2023. That suggests the Fed is prepared to raise rates by an additional 0.75 percentage points next year.

The Fed also signaled it expects its rate will come down by the end of 2024 to 4.1%, and drop to 3.1% at the end of 2025.

“This is considerably higher than expectations priced into financial markets, which are positioned for the federal funds rate to come back down to 3.9% at the end of 2023 and to 2.6% at the end of 2024,” said Bill Adams, chief economist for Comerica Bank.

Bond yields wavered for much of the afternoon as traders digested the Fed’s action. The yield on the 10-year Treasury, which influences mortgage rates, slipped to 3.48% from 3.50% from late Tuesday. The two-year yield, which more closely tracks expectations for Fed moves, held steady at 4.22%

Wall Street has been closely watching economic reports on consumer spending and employment, which remain strong. That has made it more difficult for the Fed to tame inflation while also helping to protect the slowing economy from a possible recession.

The U.S. will release its weekly report on unemployment benefits on Thursday, along with retail sales data for November.

Roughly 70% of the stocks in the S&P 500 closed lower Wednesday, with technology companies, banks and retailers among the biggest weights on the benchmark index. Apple fell 1.6%, Goldman Sachs dropped 2.3% and Best Buy slid 3.9%.

All told, the S&P 500 fell 24.33 points to 3,995.32. The Dow slid 142.29 points to 33,966.35, and the tech-heavy Nasdaq fell 85.93 points to 11,170.89.

Small company stocks also fell. The Russell 2000 index slid 11.91 points, or 0.7%, to 1,820.45.

Delta Air Lines rose 2.8% after it raised its fourth-quarter financial outlook and issued an optimistic forecast for 2023.

Market watch​

The S&P/ASX 200 looks set to open 57 points or 0.79 per cent lower, according to futures moves. The Australian benchmark climbed 0.67 per cent yesterday to its highest close in a week.

The S&P 500 lost 0.6% after giving up an earlier gain of 0.9%. The Dow Jones Industrial Average fell 0.4% and the Nasdaq composite gave back 0.8%.

All told, the S&P 500 fell 24.33 points to 3,995.32. The Dow slid 142.29 points to 33,966.35, and the tech-heavy Nasdaq fell 85.93 points to 11,170.89.

 

[bigdog]

A SEA OF RED YESTERDAY

Asian shares decline after retreats on Wall Street, Europe

Asian shares have followed Wall Street and Europe lower, with markets jittery over the risk that the Federal Reserve and other central banks may end up bringing on recessions to get inflation under control.

apnews.com

US stocks sink as Fed signals it will remain aggressive​

By DAMIAN J. TROISE and ALEX VEIGA

Stocks tumbled on Wall Street and across European markets Thursday as investors grew increasingly concerned that the Federal Reserve and other central banks are willing to risk a recession to bring inflation under control.

The S&P 500 fell 2.5%, with more than 90% of stocks in the benchmark index closing in the red. The Dow Jones Industrial Average fell 2.2% and the Nasdaq composite lost 3.2%. The broad slide erased all the weekly gains for the major indexes.

European stocks fell sharply, with Germany’s DAX dropping 3.3%.

The wave of selling came as central banks in Europe raised interest rates a day after the U.S. Federal Reserve hiked its key rate again, emphasizing that interest rates will need to go higher than previously expected in order to tame inflation.

“It’s this coordinated central bank tightening — stocks tend to not do well in that environment,” said Willie Delwiche, investment strategist at All Star Charts.

In the U.S., the market’s losses were widespread, though technology stocks were the biggest weight on the S&P 500. The benchmark index fell 99.57 points to 3,895.75.

The Dow slid 764.13 points to 33,202.22, while the tech-heavy Nasdaq dropped 360.36 points to 10,810.53

Small company stocks also fell. The Russell 2000 index slid 45.85 points, or 2.5%, to close at 1,774.61.

The Fed raised its short-term interest rate by half a percentage point on Wednesday, its seventh increase this year. Central banks in Europe followed along Thursday, with the European Central Bank, Bank of England and Swiss National Bank each raising their main lending rate by a half-point Thursday.

Although the Fed is slowing the pace of its rate increases, the central bank signaled it expects rates to be higher over the coming few years than it had previously anticipated. That disappointed investors who hoped recent signs that inflation is easing somewhat would persuade the Fed to take some pressure off the brakes it’s applying to the U.S. economy.

The federal funds rate stands at a range of 4.25% to 4.5%, the highest level in 15 years. Fed policymakers forecast that the central bank’s rate will reach a range of 5% to 5.25% by the end of 2023. Their forecast doesn’t call for a rate cut before 2024

The yield on the two-year Treasury, which closely tracks expectations for Fed moves, rose to 4.24% from 4.21% late Wednesday. The yield on the 10-year Treasury, which influences mortgage rates, slipped to 3.45% from 3.48%.

The three-month Treasury yield slipped to 4.31%, but remains above that of the 10-year Treasury. That’s known as an inversion and considered a strong warning that the economy could be headed for a recession.

“The (stock) market’s reaction is now factoring in a recession, and rejecting the possibility of the ‘soft/softish’ landing” that Fed Chair Jerome Powell raised in a speech last month, said Quincy Krosby, chief global strategist for LPL Financial.

The prospect of more Fed rate hikes have heightened Wall Street’s worries about how company earnings could fare in a recession, Delwiche said.

”(Inflation) has peaked, it will peak, it did peak, whatever, that’s not the story,” he said. “The story now is how does the economy hold up? How do earnings hold up?”

The central bank has been fighting to lower inflation at the same time that pockets of the economy, including employment and consumer spending, remain strong. That has made it more difficult to rein in high prices on everything from food to clothing.

On Thursday, the government reported that the number of Americans applying for unemployment benefits fell last week, a sign that the labor market remains strong. Meanwhile, another report showed that retail sales fell in November. That pullback followed a sharp rise in spending in October.

Like the Fed, central bank officials in Europe said inflation is not yet corralled and that more rate hikes are coming.

“We are in for a long game,” European Central Bank President Christine Lagarde said at a news conference.

Market watch​

ASX 200 futures down 81 points or 1.1% to 7080

The S&P 500 benchmark index fell 99.57 points to 3,895.75. The Dow slid 764.13 points to 33,202.22, while the tech-heavy Nasdaq dropped 360.36 points to 10,810.53

The S&P 500 fell 2.5%, with more than 90% of stocks in the benchmark index closing in the red. The Dow Jones Industrial Average fell 2.2% and the Nasdaq composite lost 3.2%.