MarketBites: Markets Pull Back
Updated: Sep 27, 2022
Portfolio Manager Commentary:
U.S. stocks closed sharply lower with the three major indexes continuing their downfall. The S&P declined 2.14%, the Dow fell 1.91%, and the Nasdaq dropped 2.6%. The Dow fell 643 points which made it the Dow’s worst day since June 16. Still, the broader market index remains about 13% above its June lows. Investors continue to worry about the Fed’s aggressive interest-rate hikes combined with a slowing economy.
Even though rate hikes can cause investor concerns, they are still a necessary tool to implement in order to straighten out an economy. According to Robert Cantwell, portfolio manager at Upholdings, “When you see the market right now dropping like this, this is the market saying the Fed has to be more aggressive to slow the economy down further.”
Looking ahead, Fed Chair Jerome Powell is set to deliver key insights surrounding inflation at the Jackson Hole Economic Symposium, an annual event for finance leaders across the globe to talk about economic issues. This week also wraps up the last week of earnings reports from the first half of 2022, with reports coming from companies such as Nvidia, Zoom, and Peloton.
Chart of the Day:
U.K. inflation stood at 10.1% year-over-year in July, which marked its highest rate in more than four decades. Taking into account current gas and electricity prices, Citigroup is estimating U.K. inflation to top out past 18%.
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