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US Market falls on hawkish Fed
(22 Sep 2023, 08:16)
The US stock market finished session lower on Thursday, 21 September 2023, as investor risk appetite was dashed after the Federal Reserve stiffened its hawkish stance with a further interest rate hike projected by the year-end.

The U.S. Federal Reserve kept interest rates unchanged at 5.25%-5.50% as widely expected on Wednesday at the conclusion of its two-day monetary policy meeting, but signalled another hike by the year-end and much tighter monetary policy through 2024 than previously expected to fight high inflation.

At the close of trade, the Dow Jones Industrial Average index declined 370.46 points, or 1.08%, to 34,070.42. The S&P500 index dropped 72.20 points, or 1.6%, to 4,330. The tech-heavy Nasdaq Composite Index decreased by 245.14 points, or 1.82%, to 13,223.98.

All 11 S&P 500 sector indexes declined, led lower by real estate, down 3.48%, followed by a 2.88% loss in consumer discretionary, 2.04% loss in materials, and 1.63% loss in industrial sectors.

Interest rate-sensitive commercial real estate stocks saw substantial weakness on the day after the Federal Reserve forecasted another rate hike before the end of the year.

Tech shares were also lower as investors rethink buying growth-oriented stocks if interest rates remain high. Tesla, Alphabet and Nvidia all lost more than 2%.

ECONOMIC NEWS: The Labor Department released a report on Thursday showing initial jobless claims dipped to 201,000, a decrease of 20,000 from the previous week's revised level of 221,000.

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