![]() On the winning side of Wall Street, shares of Textron climbed 5.9% for the biggest gain in the S&P 500 after it announced a deal where NetJets has the option to purchase up to 1,000 of its Citation business jets over the next 15 years. Shares of Klaviyo, which helps advertisers market over email and text messaging, rose 9.2% on their first day of trading. Instacart dropped 8.2% as it gave back some of its gains from its first day of trading as a public stock.Īrm Holdings, another company recently off a highly anticipated initial public offering of stock, also fell. Stocks of several companies who just recently sold their stock on public markets for the first time also fell. Big Tech stocks were among the heaviest weights on the S&P 500, and Microsoft, Apple and Nvidia all fell at least 1.9%. High rates hurt prices for all kinds of investments, and high-growth companies are typically among the hardest hit. One year is an eternity to traders, let alone two years.” “The Fed is projecting it will hit its unemployment rate and inflation targets in 2026,” he said. “Future meetings will be a tug-of-war between markets who want cuts and a Fed that is scared its job isn’t done,” said Brian Jacobsen, chief economist at Annex Wealth Management. The two-year Treasury yield, which more closely tracks expectations for Fed action, jumped to 5.17% from 5.04% shortly before the Fed's announcement. It's near its highest level since 2007, though it's still down from 4.37% late Tuesday. The yield on the 10-year Treasury rose to 4.36% from less than 4.32% shortly before the Fed's announcement. economy suggested the Fed may need to keep interest rates higher for longer in order to fully drive down pressures on inflation. They had already been climbing for months after strong reports on the U.S. Treasury yields in the bond market perked higher after the Fed released its projections. He said the Fed has already moved rates up very high very quickly, which now gives it the ability to take more time before making upcoming moves. “Forecasters are a humble lot, with much to be humble about,” Powell said. Powell, though, also stressed that forecasts could change as more data about inflation and the economy come in. “We very much expect the markets to be knocked a little bit off their axis by this.” “As you move further and further away from the meeting, the message may sink in,” said Sameer Samana, senior global market strategist at Wells Fargo Investment Institute. Stocks initially held relatively steady following the release of the Fed's forecasts, before sliding later in the afternoon. That could be a big negative for Wall Street, where investors crave rate cuts because they typically give a boost to prices for all kinds of investments. ![]() ![]() Three months ago, they were penciling in a full percentage point of cuts in 2024. Perhaps more importantly for the market, Fed officials also suggested they may cut rates next year by only half a percentage point. Officials also indicated they may raise the federal funds rate once again this year, as the Fed tries to get inflation back down to its target of 2%, though Fed Chair Jerome Powell said it's close to hitting the peak, if not there already. The Fed held its main interest rate at its highest level in more than two decades, as was widely expected. Eastern time, and the Nasdaq composite was 1.3% lower. The Dow Jones Industrial Average was down 37 points, or 0.1%, at 34,479, as of 3:45 p.m. ![]() The S&P 500 was 0.8% lower in late trading. stocks slumped Wednesday after the Federal Reserve said it may not cut interest rates next year by as much as it earlier thought, regardless of how much Wall Street wants it. High rates tend to hit high-growth stocks particularly hard, and Big Tech companies were among the market’s heaviest weights. While leaving the Fed’s main interest rate steady, officials at the central bank also suggested they may cut rates next year by only half a percentage point. The Dow lost 76 points, and the Nasdaq composite pulled back 1.5%. stocks slumped after the Federal Reserve said it may not cut interest rates next year by as much as it earlier thought, regardless of how much Wall Street wants it.
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