PARIS, Aug 19 (Reuters) – The New York Stock Exchange opened lower on Friday, hurt by statements by several Federal Reserve (Fed) officials who said the U.S. central bank should continue to raise interest rates to to curb inflation while the rate of the increase in the cost of credit raises fears.
In early trading, the Dow Jones index lost 172.45 points, or 0.51%, to 33,826.59 points and the broader Standard & Poor’s 500 fell 0.66% to 4,255.28 points.
The Nasdaq Composite lost 1.03%, or 133.04 points, to 12,832.29.
After the publication on Wednesday of the minutes of the last Fed monetary policy meeting, which gave rise to a contrasting interpretation, James Bullard, the president of the St. 75 basis points in September given the strength of the US economy.
His counterpart in San Francisco, Mary Daly, judged for her part “reasonable” both a rise of half a point and three quarters of a point.
Kansas City branch president Esther George, meanwhile, said she won’t stop advocating for monetary tightening until she’s “completely convinced” that inflationary pressures are building. to subside.
Traders are now pricing the odds of a 50bps or 75bps Fed rate hike in September almost equally, following a 225bp hike in total since March, a blistering pace that could drag the economy down in recession.
The speech next week by Jerome Powell, the Fed Chairman, at the annual conference of central bankers in Jackson Hole, may provide investors with new elements on the trajectory of rates.
On the bond market, the yield on ten-year Treasuries, up nearly ten points to 2.97%, is heading towards its third consecutive week of gains.
Growth stocks, very sensitive to changes in interest rates, fell like Amazon and Alphabet, which lost 1.17% and 1.21% respectively, while the “tech” compartment fell by 0, 89%.
In corporate news, Deere tumbled 3.77% after the world’s largest farm machinery maker lowered its full-year profit forecast, while Bed Bath & Beyond plunged 42.64%, continuing to to suffer from the sale by billionaire investor Ryan Cohen of his stake in the housewares brand.
On the upside, General Motors took 2.58% thanks to the announcement by the automaker of a resumption of the payment of the quarterly dividend. Foot Locker (+21.26%), for its part, benefited from better than expected quarterly results and the announcement of the appointment of the former director of Ulta Beauty Mary Dillon to the post of general manager of the group.