U.S. stock futures unable to rebound from latest sell-off as more Powell talk looms
Published: March 8, 2023 at 4:50 p.m. ET
US stock futures struggled to recover from the recent sell-off as concerns over a more hawkish Federal Reserve pushed bond yields higher.
How are stock index futures traded?
On Tuesday, the Dow Jones Industrial Average DJIA was down 575 points, or 1.72%, to 32856, the S&P 500 SPX was down 62 points, or 1.53%, to 3986, and the Nasdaq Composite COMP was down 145 points, or 1.25%, to 11530.
What moves the markets
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US stock futures struggled to recover from the recent sell-off as concerns over a more hawkish Federal Reserve pushed bond yields higher.
How are stock index futures traded?
- S&P 500 futures
ES00
are down less than 1 point, or 0.05%, to 3989
- Dow Jones Industrial Average Futures
YM00
rose 29 points, or less than 0.1%, to 32892
- Nasdaq 100 futures
NQ00
Added 4.75 points or 0.05% to 12177
Tuesday’s Dow Jones Industrial Average
DJIA
fell 575 points, or 1.72%, to 32856, the S&P 500
SPX
down 62 points, or 1.53%, to 3986 and the Nasdaq Composite
COMP
fell 145 points or 1.25% to 11530.
What moves the markets
Sentiment in stock markets is again fragile after Federal Reserve Chairman Jay Powell told the Senate Banking Committee on Tuesday that the central bank is ready to increase the pace of interest rate hikes if data suggests it will justified to curb inflation.
Powell will make additional testimony Wednesday, this time before the House Financial Services Committee, beginning at 10:00 a.m. EST
Powell’s comments have hurt Treasuries and forced short-term yields
TMUBMUSD02Y
to new four-decade highs as the market increased bets that the Fed could hike rates by 50 basis points in two weeks and eventually hike rates to 5.65% by the fall.
The sight of rising implied borrowing costs and the prospects of a recession they could cause pushed the S&P 500 equity barometer back below 4,000 and its 50-day moving average.
And this talk of the Fed raising rates “for longer” continued to shake stock investors on Wednesday.
“The global stock sell-off continues and investors are shaken by the realization that the Federal Reserve’s work in trying to tame rampant US inflation is far from over. Wall Street ended in a sharp pullback and risk aversion has spilled over into trading in Asia, with European indices also heading lower in early trade,” said Susannah Streeter, head of money and markets at Hargreaves Lansdown, in a statement to customers.
Mohamed El-Erian, adviser to Allianz and Gramercy, wrote in a tweet: “Inflation is forcing major central banks to abandon the policy regime of volatility suppression through interest rate floors and QE. This is a source of volatility, as is global economic fluidity. The last thing the economy and markets need is that extra layer of politically induced volatility.”
Other US economic updates due for release on Wednesday include February’s ADP jobs report at 8:15 am, followed by January’s trade balance at 8:30 am. The JOLTS Job Opportunities Survey will be released at 10:00 am. The Fed’s beige book of economic anecdotes will be released at 2:00 p.m. Alltimes Eastern.