by Chuck Mikolajczak
NEW YORK (Reuters) – The New York Stock Exchange ended lower on Tuesday and recorded a decline for the whole of February, as investors continued to question the possibility that the United States Federal Reserve (Fed) keeps interest rates high longer than expected.
The Dow Jones index fell 0.71%, or 232.39 points, to 32,656.70 points.
The broader S&P-500 fell 12.09 points, or 0.30%, to 3,970.15 points.
The Nasdaq Composite fell for its part by 11.44 points (0.10%) to 11,455.54 points.
After posting a solid rebound in January, major Wall Street indexes retreated as economic data and comments from Fed officials prompted markets to consider the U.S. central bank continuing to raise its benchmarks. rates and keep them high for longer than expected.
In February, the Dow Jones fell by 4.19%, the S&P-500 by 2.61% and the Nasdaq by 1.11%.
The economic situation was expected to deteriorate more quickly, forcing the Fed to make a shift in its monetary policy, “to suspend or cut rates sooner than it said”, commented Johan Grahn, strategist at Allianz InvestmentManagement.
Some traders are now starting to bet on a 50 basis point rate hike following the Fed’s monetary policy meeting in March, with rates expected to peak at 5.40% in September.
However, economic data released during the day showed that consumer confidence unexpectedly deteriorated in February.
Traditionally linked to interest rate movements, the yield on two-year US Treasury bills rose to 4.816%.
Wall Street has been accustomed to volatility since the Fed launched its rate hike program last year in an effort to control runaway inflation.
The Dow Jones was weighed down on Tuesday by the 3.8% decline of Goldman Sachs, following the announcement by the chief executive of the American bank that it was considering “strategic alternatives” for its consumer activities.
Target rose 1.01% after reporting an unexpected surge in fourth-quarter sales, even as the retailer warned of its 2023 results citing uncertainties for the U.S. economy.
Meta Platforms jumped 3.19% following the announcement of work on a generative artificial intelligence product.
( Jean Terzian)
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