New York, Friday, 11 November 2022
As a result of further revelations surrounding the FTX-related drama, much of the enthusiasm witnessed after the CPI report started to fade, the Dow fell more than 100 points on Friday, while the S&P 500 and Nasdaq remained flat.
The official bankruptcy of Sam Bankman-exchange Fried's FTX has sent shockwaves through risk asset classes and precipitated a significant decline in cryptocurrency prices.
The Federal Reserve has been expected to decrease the rate of its interest rate hikes, but a sharper-than-expected decline in US inflation has revived those bets.
As a result, money markets now predict that there will be a 50-bps increase in interest rates in December with an 80% probability.
According to San Francisco's Mary Daly and Dallas Fed President Lorie Logan, it could be wise to moderate the pace in order to more accurately analyse the state of the economy.
All three of the major US stock indices are still expected to post significant weekly gains; the Nasdaq outperformed by climbing 7%, while the blue-chip Dow and S&P 500 added 3.6% and 5.1%, respectively.
(Report by: The Decision Maker – Finance editors)