The three main Wall Street indices had chained their third consecutive weekly decline on Friday and the benchmark S&P 500 registered its largest weekly percentage drop since March 2020, in the wake of the Federal Reserve’s biggest interest rate hike in nearly three decades.
What happened is that after the Fed, other major central banks, including the Swiss National Bank and the Bank of England, also raised rates last week. This raised fears that aggressive monetary tightening would slow the global economy, possibly triggering a recession.
All 11 major sectors of the S&P 500 were higher in morning trading. Energy led gains, rising 4.2%, as oil prices rose on summer fuel demand and tight supplies.
Shares of Apple Inc and Tesla Inc. jumped 3.6% and 8.5%, respectively, boosting the Nasdaq Composite Index.
The CBOE volatility index, also known as Wall Street’s barometer of fear, fell to 30.21 points, its lowest level since June 15.
Markets are now awaiting Fed Chairman Jerome Powell’s testimony before the Senate Banking Committee, due on Wednesday, for more signs on the central bank’s tightening cycle.
Source: Ambito
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