July 25, 2024

MediaBizNet

Complete Australian News World

Dow drops 100 points as market sell-off returns after Powell’s new anti-inflation pledge

Dow drops 100 points as market sell-off returns after Powell’s new anti-inflation pledge

Stocks fell on Thursday as Wall Street weighed on Federal Reserve Chair Jerome Powell’s comments about the central bank’s continued fight against inflation.

The Dow Jones Industrial Average fell 105 points, or 0.32%. The S&P 500 was down 0.28%, and the Nasdaq Composite was down 0.32%.

Stocks fell during a Question and answer session from Powell At the Cato Institute, he reiterated that the central bank would do whatever it takes to combat inflation. He also indicated that a pause in interest rate hikes or the pivot for interest rate cuts will not be soon.

“History strongly warns against premature easing,” he said. “I can assure you that I and my colleagues are deeply committed to this project and will continue to do so until the job is done.”

Earlier in the morning, the European Central Bank raise interest rates by 0.75 percentage points, lifted it Deposit to 0.75% from zero, In a largely expected move to curb inflation.

The stock market comes out of a strong recovery. On Wednesday, the major averages posted their best day since August 10, with the Nasdaq halting seven straight days of losses.

However, stocks remain in a downtrend overall as concerns about a slowing economy and an increase in interest rates by the Federal Reserve push some investors away from riskier parts of the market.

“Recession risks are increasing as we move more defensively in our portfolios as a result. However, higher inflation means that traditional ‘risk-off’ strategies such as cash and government bonds can create a drag on total return,” Lauren Goodwin, economist and portfolio strategist at New York Life Investments, in a note to clients.

READ  EXCLUSIVE: Tesla makes China's most popular CEO after Musk

“We are fully invested in our portfolios, using selective bets within this generally neutral position to build resilience against volatility and inflation. In our equity envelope, this includes a significant increase in share value and dividend payers,” added Goodwin.