Wall Street closes sharply lower

Sept 29 (Reuters) – The New York Stock Exchange ended sharply lower on Thursday, weighed down again by fears of recession fueled by aggressive monetary policy tightening, as well as turmoil in the foreign exchange and debt markets.

The Dow Jones index fell 458.13 points, or 1.54% to 29,225.61 points, the S&P 500 lost 78.57 points or 2.11% to end at 3,640.47 and the Nasdaq Composite ended in down 2.84% to 10,737.506 points, close to its lowest closing level for the year hit in mid-June.

Tech giants, sensitive to swings in interest rates, suffered particularly, with Tesla dropping 6.8% and Apple nearly 5%.

Meta Platforms, owner of Facebook, fell 3.67% after reports from the Bloomberg agency that the group froze its hiring and warned its employees that it was considering restructuring in an uncertain macroeconomic context.

The S&P, which has recovered to its November 2020 closing levels, is on track to record its worst September since the 2008 crisis. It is down more than 8% since the start of the month.

Several Federal Reserve officials have hinted that the U.S. central bank has no intention of moderating or altering its policy of ramming interest rate hikes in order to rein in inflation, leading to further releases on the bond markets.

Added to this was the surprise drop in weekly jobless claims announced by the Labor Department, which “confirms that the Fed still has a long way to go,” according to Phil Blancato, director of Ladenburg Thalmann Asset Management in New York.

“The fear in the markets is that the Fed is going to push us into a very deep recession, which will cause corporate earnings to fall,” he added.

At retail, used-car retailer CarMax fell nearly 25% after it missed market expectations for its second-quarter results, due to lower retail vehicle purchases. General Motors (-5.6%) and Ford (-5.8%) were also hard hit by ricochet.

Airlines and cruise lines also ended in the red after a series of cancellations due to Hurricane Ian’s passage over Florida.

(Written by Jean-Stéphane Brosse)

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