by Chuck Mikolajczak
NEW YORK (Reuters) – The New York Stock Exchange ended lower for a third straight session on Friday as fears grew that the U.S. Federal Reserve (Fed) could push the economy into recession with its continued stimulus measures. monetary tightening to fight inflation.
The Dow Jones Industrial Average fell 0.85%, or 281.76 points, to 32,920.46 points.
The broader S&P-500 lost 43.39 points, or 1.11%, to 3,852.36 points.
The Nasdaq Composite fell for its part by 105.11 points (0.97%) to 10,705.41 points.
All three major Wall Street indexes are down weekly. The Dow Jones lost 1.66%, the S&P-500 2.09% and the Nasdaq 2.72%.
While the Fed’s decision, announced on Wednesday, to raise interest rates by 50 basis points was anticipated, equities came under further pressure following comments from the head of the US central bank.
Jerome Powell hinted after the release of the Fed’s statement that monetary tightening would continue into 2023, with rates seen above 5% – a threshold more seen since the economic low of 2007.
Statements made since then by other central bank officials have fueled market concerns. New York Fed President John Williams said on Friday that rates could rise more than expected next year, saying Fed policy would not lead to a recession. .
“Once again, like deja vu, the market seems to have rushed a bit on how and when the Federal Reserve is going to get more conservative and start talking in terms that will make the market understand when it will be less restrictive,” said Keith Buchanan, portfolio manager at Globalt Investments in Atlanta.
“The market is now more fearful of a policy that would remain so restrictive… There are fears that a policy error is more likely,” he added.
A survey released on Friday showed that economic activity in the United States deteriorated more than expected in December, due to a decline in new orders to a low of more than two and a half years.
All the major sectors of the S&P-500 fell, in particular real estate which lost nearly 3%.
On the stock side, Meta Platforms rose 2.82% after JP Morgan revised its recommendation upwards.
Adobe gained 2.99% following a first-quarter 2023 profit forecast that beat expectations.
(French version Jean Terzian)