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The Dow Jones Industrial Average fell for a second day as investors digested the Federal Reserve’s latest policy update, where it moved up its timeline for interest rate hikes and forecast higher inflation.
The 30-stock index dumped 210.22 points to close Thursday at 33,823.45, weighed down by 3% losses in Dow Inc. and Caterpillar as most commodity prices took a hit.
The S&P 500 dipped 1.84 points to 4,221.86
The NASDAQ gained 121.67 points to 14,161.35, as investors huddled in some Big Tech stocks with Tesla up 1.9% and Snowflake up 2.8%. Shopify took on 6.1% and Twilio gained 8%.
Materials-related stocks led the losses as the Fed’s move to eventually raise rates, along with a current campaign by China to tamp down metals prices, took the air out of a surge in commodity prices this year.
The closely-watched Federal Reserve meeting Wednesday spurred a selloff in equities after the central bank moved up its timeline for rate hikes, seeing two increases in 2023
The Fed also hiked its inflation forecast to 3.4% for the year, a percentage point higher than the Federal Open Market Committee’s forecast in March.
Materials stocks were weaker Thursday as higher rates may further take the air out of a big commodities rally in 2021. China is also cracking down on the commodities surge to ease inflation fears. Freeport-McMoRan led materials stocks lower, down about 7%. Copper futures were off by 2%.
The U.S. Labor Department reported that initial jobless claims rose last week to 412,000, up from the previous week’s 375,000. Economists polled by Dow Jones expected jobless claims of 360,000.
Prices for 10-Year Treasurys were higher, bringing down yields to 1.52% from Wednesday’s 1.57%. Treasury prices and yields move in opposite directions.
Oil prices lost $1.26 to $70.89 U.S. a barrel.
Gold prices slipped $87.10 to $1,774.30 U.S. an ounce.
