23rd September 2022 – (New York) U.S. stocks dropped on Thursday as investors had mounting fears that the Federal Reserve’s aggressive policy tightening could tip the economy into a recession.
The Dow Jones Industrial Average decreased 107.10 points, or 0.35 percent, to 30,076.68. The S&P 500 declined 31.94 points, or 0.84 percent, to 3,757.99. The Nasdaq Composite Index was down 153.38 points, or 1.37 percent, to 11,066.81.
Nine of the 11 primary S&P 500 sectors ended in red, with consumer discretionary and financials down 2.16 percent and 1.66 percent, respectively, leading the laggards. The health care and the communication services groups eked out modest gains.
The Fed on Wednesday delivered a third consecutive 75-basis-point hike this year and signaled more jumbo rate hikes ahead in a bid to stifle rampant inflation.
The move “was in line with our view that the Fed will remain hawkish until there are clear signs that inflation is moving back to its target, even if that undermines growth,” UBS analysts said Thursday in a note.
On the economic front, U.S. initial jobless claims, a rough way to measure layoffs, increased by 5,000 to 213,000 for the week ending 17th Septenber, the Department of Labor reported on Thursday. Economists polled by The Wall Street Journal had forecast new claims to total 214,000.