- Fed hikes, recession fears in focus
- L3Harris down after $4.7 billion Aerojet acquisition: Dow 0.49%, S&P 0.90%, Nasdaq 1.49%
Dec 19 (Reuters) – Wall Street closed lower for a fourth straight session on Monday with the Nasdaq leading decliners as investors worried the Federal Reserve’s tightening campaign could push the U.S. economy into recession.
The three major US stock indexes were under pressure on Wednesday after taking a hawkish tone as Fed Chairman Jerome Powell raised interest rates. Powell promised more hikes even as the data showed signs of a weakening economy.
S&P 500 (.SPX)Dow Jones industrials (.DJI) and the Nasdaq sold off sharply for December, heading for their biggest annual decline since the 2008 financial crisis.
Even as U.S. Treasury yields rose, investors shunned stocks for the prospect of safer bets as they worried about the prospect of a recession in 2023, according to Brian Overby, chief market strategist at Ally.
“Investors are asking why I want to take risks going into 2023 with the Fed still aggressive when I can make such good returns in a fixed-income market place,” he said.
According to Melissa Brown, Global Head of Applied Research at Gontigo in New York, the lack of major earnings reports or economic data on Monday kept investors focused on economic fears and interest rates.
“It’s a knife edge between whether we go into recession or a soft landing. Is the Fed doing the right thing?” Brown also noted that the moves could be exaggerated because many investors are on vacation around the year-end holidays.
Dow Jones Industrial Average (.DJI) The S&P 500 fell 162.92 points, or 0.49%, to 32,757.54 (.SPX) The Nasdaq Composite lost 34.7 points, or 0.90%, to 3,817.66. (.IXIC) It fell 159.38 points or 1.49% to 10,546.03.
Communications services were the biggest decliners among S&P industrial sectors (.SPLRCL)Decreased by 2.2%, due to consumer demand (.SPLRCD)1.7% and technology decreased (.SPLRCT)It decreased by 1.4%. Energy (.SPNY) Up 0.13%, it was the only one of the 11 industries to outperform.
Market heavyweights like Apple Inc (AAPL.O)Microsoft Corp (MSFT.O) and Amazon.com Inc (AMZN.O) created some of the biggest drags on the market.
Trading in Tesla Inc (TSLA.O) The electric car maker was volatile, closing 0.24% after falling as much as 2.8% during the session. It was later In a Twitter poll It found that a majority of respondents wanted Tesla CEO Elon Musk to step down as CEO of the social media platform.
Meta platforms (META.O) Shares fell 4.1% after the European Commission said it could impose a fine up to 10% of the tech conglomerate’s annual global turnover if evidence shows a breach of EU antitrust laws.
L3Harris Technologies Inc (LHX.N) It lost 3.6% after the USA defense contractor said it will buy hypersonic engine maker Aerojet Rocketdyne Holdings Inc (AJRD.N) for $4.7 billion. Aerojet added 1.3%.
Shares of casino operators Melco Resorts & Entertainment fell slightly more than 8% and Wynn Resorts (WYNN.O) Las Vegas Sands Corp. lost 5.2% (LVS.N) It fell 2.3% after Macau said on Friday that six casino firms would invest about $15 billion as part of new 10-year contracts to operate in the world’s biggest gambling hub.
Declining issues outnumbered advancing ones on the NYSE by a ratio of 2.80 to 1; where the Nasdaq favored decliners by a 2.63-1 ratio.
The S&P 500 posted 5 new 52-week highs and 20 new lows; The Nasdaq Composite recorded 66 new highs and 456 new lows.
11.07 billion shares changed hands on US exchanges, compared to the 11.59 billion average for the last 20 trading days.
Reporting by Sinéad Carew, Sruthi Shankar, Shubham Batra, Johann M Cherian and Sruthi Shankar in Bengaluru; Edited by Saumyadeb Chakrabarty, Maju Samuel and David Gregorio
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