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U.S. Stocks Fall After Fed Sets Expectations for Rate Path

Stock Markets Sep 22, 2022 10:55AM ET
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By Liz Moyer

Investing.com -- U.S. stocks fell a day after the Federal Reserve delivered its predictions for the path of interest rates.

At 10:53 ET (14:53 GMT), the Dow Jones Industrial Average was down 85 points, or 0.3%, while the S&P 500 was down 0.8% and the NASDAQ Composite was down 1.3%.

As expected, the Fed raised its benchmark rate by a 0.75 percentage point. It also offered forecasts for rates, saying they would rise above 4.5% next year, which is higher than expected and a period that was longer than expected.

Investors have worried that an aggressive Fed could tip the economy into a recession. The Fed is determined to tame inflation, and acknowledged that it would mean unemployment will rise in the process. 

The labor market remains tight, with 213,000 new jobless claims filed last week, which was below expectations and only slightly above the revised figure for the week before. 

The Fed predicted yesterday that unemployment would rise to 4.4% next year from 3.7% now, though Chair Jerome Powell pointed out during a press conference yesterday that there are still a high number of job openings versus job seekers. 

Robinhood Markets Inc (NASDAQ:HOOD) shares rose 1.5% on a report the Securities and Exchange Commission will allow brokers to keep their payment for order flow business model, after criticism of the practice. The report by Bloomberg said there could be rule changes ahead.

Shares of Salesforce Inc (NYSE:CRM) rose 2.5% after the software maker said fiscal year revenue was targeted to be $50 billion.

Oil jumped. Crude Oil WTI Futures was up 0.7%, to $83.47 a barrel, while Brent Oil Futures crude rose 0.7%, to $90.47 a barrel. Gold Futures rose 0.2% to $1679 an ounce.

U.S. Stocks Fall After Fed Sets Expectations for Rate Path
 

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Comments (24)
Ken Roth
Ken Roth Sep 23, 2022 2:35AM ET
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FED is nice a slowly ****all growth in US and the rest of the world with their extreme rate hikes. Dollar is climbing and oil is priced in Dollars creating inflation in other nations added to the energy crisis, which means fewer money to buy american products. We are on a clear path to the poor 1980´ies. Good work in ****the economy. Must be great to be a bear investor.
NITESH SHARMA
NITESH SHARMA Sep 23, 2022 2:10AM ET
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all market trash please help biden bullish
Ric Later
riclater211 Sep 22, 2022 12:15PM ET
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the markets and especially tech are overvalued by about 30%. This is as good thing. Equilibrium is needed. Rates need to hit 5ish.
Brad Albright
Brad Albright Sep 22, 2022 12:15PM ET
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Right! For more than a decade, people have been complaining that the US stock markets were artificially supported by excessive Federal Reserve liquidity. Well, here we are: that liquidity is now being withdrawn and markets are returning to fair value. Not a bad thing.
Hungry Fish
Hungry Fish Sep 22, 2022 11:32AM ET
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Fed actually want a big recession to start over fresh. Unluckily, US economy is too strong so that they have to push very hard in order to collapse the mrk. It's about time. Cheers!
First Last
First Last Sep 22, 2022 11:32AM ET
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Not "big recession.  Little.  Powell said, "We're at the very lowest level of what is restrictive"
Stephen Fa
Stephen Fa Sep 22, 2022 11:28AM ET
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Fed's monetary policy is simply reacting to Democrat's fiscal policies of social spending and oil and gas energy supply.
First Last
First Last Sep 22, 2022 11:28AM ET
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The Democrats haven't really changed US policies on oil and gas.  It's been Russia for months.
Stephen Fa
Stephen Fa Sep 22, 2022 11:28AM ET
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Laughable reply lie considering new well oil and gas drilling permits issued by Biden's DOI.
First Last
First Last Sep 22, 2022 11:28AM ET
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US productions of crude & nat gas (now at all-time-high) have been trending up under Biden.
First Last
First Last Sep 22, 2022 11:28AM ET
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"Even though it only accounts for roughly 7% and 8% of domestic production, respectively, oil and gas production on public lands is at or near an all time high. Similarly, the Biden administration is continuing to approve drilling permits. During 2021, the Bureau of Land Management approved nearly 4,000 drilling permits — a rate higher than during the first three years of the Trump administration. Now, the oil industry is sitting on a remarkable 9,173 approved, but unused, federal lands drilling permits."
First Last
First Last Sep 22, 2022 11:28AM ET
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westernpriorities.org, 2022/03
Buy And Sell
Buy And Sell Sep 22, 2022 11:20AM ET
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A dire warning, stocks will crash over time, maybe recover in summer 2025. Sell all stocks now or go broke...
EL LA
EL LA Sep 22, 2022 11:16AM ET
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I think the Fed is very happy today, but certainly more needs to be done. The USD needs to go to 125 and many more people need to lose their jobs.
First Last
First Last Sep 22, 2022 11:16AM ET
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"The labor market remains tight, with 213,000 new jobless claims filed last week, which was below expectations"
Stephen Fa
Stephen Fa Sep 22, 2022 11:16AM ET
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Now do labor force participation stats since Dems are paying lazy people to stay home.
First Last
First Last Sep 22, 2022 11:16AM ET
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Stephen Fa   Trended up since Biden's inauguration from 61.4% to 62.4% in Aug.
Ma Lu
Ma Lu Sep 22, 2022 11:09AM ET
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The downward trend will continue in 2023!
Sylvia Doloff
Sylvia Doloff Sep 22, 2022 11:08AM ET
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people are losing alot of money plain and simple
First Last
First Last Sep 22, 2022 11:08AM ET
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Because Russians are taking Ukrainian lives and land.
stmcleish .
stmcleish . Sep 22, 2022 11:06AM ET
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It's better the Fed's slow inflation down with interest rate hikes then have them peak on their own and total collapse needing massive stimulus devaluing your wealth to try to beat deflation. I think the Fed's doing exactly as needed atm. They couldn't of been more clear as to what they want business and corporations should adjust accordingly to maintain profit margins.
 
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