The S&P 500 closed Friday with its biggest drop for a September in more than a decade, crossing the finish line of a tumultuous quarter loaded with historically high inflation, rising interest rates and recession fears.
All three major indices ended sharply lower, having negated a brief rally earlier in the session.
The S&P and Dow posted their third consecutive weekly declines, with all three indices posting their second consecutive monthly losses.
In the first nine months of 2022, Wall Street suffered three quarterly declines in a row, the longest losing streak in the S&P and the Nasdaq since 2008 and the Dow’s longest quarterly drop in seven years.
“It’s another ugly day to end an ugly quarter in what looks to be a very ugly year,” said Ryan Detrick, chief market strategist at Carson Group in Omaha, Nebraska.
The Federal Reserve has rattled markets by embarking on its most relentless series of interest rate hikes in decades in an effort to curb stubbornly high inflation, which has many market participants watching key economic data for signs of an impending recession .
“The realization that the Federal Reserve is doing everything it can to combat inflation that has been in the air for 40 years has investors worried that it will push the economy over the edge and into recession,” Detrick added.
The Commerce Department’s report on personal consumption expenditures (PCE) did little to allay those fears, as it showed that while consumers continue to spend, the prices they pay have accelerated, moving further away from the inflation target of the Federal Reserve and virtually assuring that the central bank’s monetary policy will continue for longer than investors expected.
Recession fears were also echoed by dire warnings from Nike Inc and cruise operator Carnival Corp, both citing inflation-related margin pressures.
According to preliminary data, the S&P 500 lost 1.151%%, to 3,585.62 points, while the Nasdaq Composite lost 1.51% with 10,575.62 points and the Dow Jones Industrial Average it fell 1.71% to 28,725.51 units.
Rate-sensitive stocks, including Tesla Inc, Meta Platforms, Alphabet Inc y Microsoft Corp they gained between 0.1% and 1.7%, following a drop in the yield on the 10-year Treasury note to a one-week low of 3.682 percent.
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