New York, Wednesday, 21 September 2022
In choppy trading Wednesday afternoon, U.S. stocks fell as the Federal Reserve handed down another hefty interest rate increase in its battle against persistent inflation.
For the third time in a row, the U.S. central bank increased its benchmark policy rate by 0.75%, raising the federal funds rate from its previous range of 2.25% to 2.5% to a new range of 3.0% to 3.25%, which is its highest level since 2008.
The technology-heavy Nasdaq Composite fell about 1.8%, while the S&P 500 and Dow Jones Industrial Average both lost by 1.7%. Meanwhile, Wall Street's "fear" indicator, the CBOE Volatility Index (VIX), temporarily surged above 30 for the first time since July 1.
Following the policy announcements, attention was focused on activity throughout the whole bond market. The rate-sensitive 2-year Treasury note surpassed 4.1% on Wednesday, the highest level since 2007. Treasury yields resumed their dangerous upward trend. The benchmark 10-year U.S. note maintained over 3.5%, which was a high point since 2011.
General Mills (GIS), one of the market mover on Wednesday, saw a roughly 6% increase after the business posted better-than-expected quarterly earnings and increased its full-year sales outlook as a result of higher prices for pet food, snack bars, and breakfast cereal.
(Source: Yahoo!Finance Edit by: The Decision Maker – Finance editors)
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