The Dow Jones New York Stock Exchange Index closed negative on Wednesday (Sept. 20) after the Federal Reserve (Fed) decided to maintain interest rates as expected at its latest meeting. But it signaled another interest rate hike this year. Because the Fed is not yet finished with its mission to fight inflation.
The Dow Jones Industrial Average closed at 34,440.88 points, down 76.85 points or -0.22%, the S&P 500 Index closed at 4,402.20 points, down 41.75 points or -0.94%, and the Nasdaq Index closed at 13,469.13 points, down 209.06 points or -1.53%.
The Federal Reserve’s (Fed) Monetary Policy Committee (FOMC) decided to maintain short-term interest rates at 5.25-5.50% at its meeting yesterday. which is the highest level in 22 years by maintaining interest rates as the market expected
The FOMC Committee also released a report summarizing economic forecasts (Summary Economic Projections (SEP)) and policy interest rate forecasts (Dot Plot), indicating that Fed officials signaled a further increase in interest rates by 0.25% to a range of 5.50%-5.75. % by the end of this year and sent a signal to cut interest rates twice to 5.1% by the end of 2024 and reach 3.9% by the end of 2025.
As for the economic forecast The Fed raised its forecast for US economic growth to 2.1% this year from the previous forecast of 1.0%, and expected inflation to drop to 3.3% by the end of the year, reaching 2.5% by the end of the year. 2024 and reach 2.2% by the end of 2025. The Fed expects inflation to return to its target level of 2% in 2026, which is slower than Fed officials previously expected.
On the other hand, Mr. Jerome Powell, Chairman of the Fed, sent a signal during a press conference to the media that US inflation will return to the Fed’s target. It still takes a long time.
All three major indexes closed in negative territory after the Fed announced its meeting decision, with the Nasdaq falling more than 200 points, pressured by a fall in technology stocks, which are sensitive to interest rates. Microsoft shares fell 2.4%, Apple shares fell 2%, Indian shares fell 2.94%, and Micron Technology shares fell 1.46%.
Pinterest shares jumped 3.1% after the company announced plans to buy back $1 billion in shares.
Investors are keeping an eye on US economic data today, including the number of weekly jobless claims, August second-hand home sales, August leading economic indicators from the Conference Board.
Tomorrow, the Purchasing Managers’ Index (PMI) for the September service sector will be revealed. and the September Primary Manufacturing Purchasing Managers Index (PMI) from S&P Global.
2023-09-20 23:29:35
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