Stock market news live updates: Stocks sink after Fed hikes, Powell gives hawkish outlook – Yahoo Finance

U.S. stocks fell in volatile trading Wednesday after the Federal Reserve delivered its seventh and final interest rate increase of 2022 and Chair Jerome Powell asserted in hawkish remarks that further tightening would come in the new year.
The central bank lifted its key policy rate by half a percentage point, slowing the pace from hikes of 75 basis points across the prior four meetings. The move brings the federal funds rate to a new range of 4.25% to 4.5%, the highest level since December 2007.
The S&P 500 (^GSPC) declined 0.6% after two days of gains, while the Dow Jones Industrial Average (^DJI) shed about 140 points, or 0.4%. The technology-heavy Nasdaq Composite (^IXIC) was off by 0.8%. U.S. Treasury yields held steady after a brief jump following the decision.
"Restoring price stability will likely require maintaining a restrictive policy stance for some time," Powell said in a speech following the rate announcement.
Fresh economic forecasts from the Fed that accompanied the decision show officials now see benchmark interest rates peaking at a median of 5.1% in 2023, 50 basis points higher than the previously projected 4.6% in September. Officials then see rates coming down to 4.1% in 2024, also slightly higher than previously projected.
"A downshift by the Fed was well-telegraphed so the hike was likely priced in, but some investors may have been surprised by the Fed’s fund forecast showing a more hawkish outlook than expected—a reminder that even though we may be approaching the finish line, we aren’t there yet," Mike Loewengart, head of model portfolio construction at Morgan Stanley, said in an emailed note.
"While it was good to see inflation come down these last two months, the Fed will need to see a few more signs over a longer time frame that inflation is under control before a full pivot."
The decision follows Wednesday’s closely watched November Consumer Price Index (CPI), which rose at an annual 7.1% clip last month, the second consecutive downside surprise in inflation data. Stocks closed higher following the report, but Wall Street’s reaction was underwhelming, with uncertainty still ahead around how much further rates need to go to quell prices that remain persistently high.
While a downshift in inflation was welcome on Wednesday, equity markets pared much of the gains that came immediately following the print as traders thought, “what now?,” BMO Wealth Management’s Chief Investment Strategist Yung-Yu Ma said in an emailed note.
“The Fed is still going to focus on the labor market imbalance, a dovish pivot is still a long way off, and in the meantime, companies and consumers have to recalibrate to the impact of higher interest rates and a slowing economy,” Ma added. “It’s all a balancing act, which we believe points to near-term choppy markets even though the improving inflation backdrop adds a positive bias.”
That view was echoed by other Wall Street strategists, including Bank of America Chief U.S. Economist Michael Gapen, who indicated that although November’s consumer price report reflected a faster retracement in core goods inflation than expected, services inflation remains sticky.
“It may bring up discussions of another downshift in February,” Gapen said in a note written along with his team at BofA. “We still think they go by 50 basis points given the tightness in the labor market and elevated wage growth, but the debate should be livelier especially if we get another soft December inflation report.”
Among specific movers in trading Wednesday, Sofi (SOFI) shares jumped more than 6% after a regulatory filing showed Chief Executive Officer Anthony Noto recently purchased $5 million worth of company shares.
Shares of Charter Communications (CHTR) tumbled a record one-day decline of 16% following a wave of downgrades that came after the telecom giant announced plans during its investor day to spend big in coming years on a high-speed internet upgrade — starting with $10.7 billion in 2023, more than analysts expected.
Tesla (TSLA) continued a recent downshift, falling 2.6% after a 4% slide in the previous session. Declines in Tesla on Wednesday came following a price cut from Goldman Sachs and continued selling pressure over concerns around CEO Elon Musk's management of Twitter.
Tesla's stock is down more than 18% this month and 50% year-to-date. Since closure of Musk's deal to acquire Twitter Oct. 27, the stock has cratered roughly 28%.
This week marks what is perhaps the last week of major U.S. economic events of the year for investors, with the government’s retail sales report also on the docket for Thursday. Even as a jam-packed economic calendar keeps traders busy domestically, traders will watch moves by central banks overseas, with policymakers from the U.K. Bank of England, Mexico, Norway, the Philippines, Switzerland, and Taiwan all set to carry out their own rate decisions on Thursday.
The U.K. received its own inflation reading Tuesday: A rapid rise in consumer prices decelerated slightly to 10.7% from a year earlier in November, down from a 41-year high of 11.1% during the prior month. U.K. equities retreated as investors awaited the U.S. Federal Reserve's messaging later today and the Bank of England's rate decision Thursday. The pound traded near its highest level since June.
Back on this side of the Atlantic, all eyes were also on the latest developments in cryptoworld, with former CEO of fallen cryptocurrency exchange FTX Sam Bankman-Fried facing a wave of criminal charges for his handling of customer and investor assets.
On the earnings front, companies including Lennar (LEN), Trip.com (TCOM), and Weber (WEBR) are scheduled for release on Wednesday.
—
Alexandra Semenova is a reporter for Yahoo Finance. Follow her on Twitter @alexandraandnyc
Click here for the latest trending stock tickers of the Yahoo Finance platform
Click here for the latest stock market news and in-depth analysis, including events that move stocks
Read the latest financial and business news from Yahoo Finance
Download the Yahoo Finance app for Apple or Android
Follow Yahoo Finance on Twitter, Facebook, Instagram, Flipboard, LinkedIn, and YouTube
Related Quotes
The Federal Reserve raised interest rates by 0.50% on Wednesday, capping a year that saw the central bank lift rates by 4.25%.
Yahoo Finance senior markets reporter Jared Blikre breaks down how investors and markets are reacting to the Fed's latest interest rate hike decision after of Wednesday's closing bell.
FTX's new CEO appeared on Capitol Hill on Tuesday, contending the company under former CEO Sam Bankman-Fried was little beyond a vehicle for funneling customer funds into different ventures.
J.P. Morgan’s Chair of Global Research Joyce Chang joins Yahoo Finance Live to discuss the Fed's latest rate hike, the risk of a recession, and how markets have responded.
The SEC charged seven “social media influencers” — who had amassed hundreds of thousands of followers on Twitter and Discord — with securities fraud, alleging they manipulated stock prices to reap at least $100 million in ill-gotten gains. The agency also issued a charge against an eighth individual with allegedly aiding and abetting the “scheme.” […]
WASHINGTON (Reuters) -The Federal Reserve will deliver more interest rate hikes next year even as the economy slips towards a possible recession, Fed Chair Jerome Powell said on Wednesday, arguing that a higher cost would be paid if the U.S. central bank does not get a firmer grip on inflation. Recent signs of slowing inflation have not brought any confidence yet that the fight has been won, Powell told reporters after the Fed's policy-setting committee raised its benchmark overnight interest rate by half a percentage point and projected it would continue rising to above 5% in 2023, a level not seen since a steep economic downturn in 2007. Those rises in borrowing costs would come despite an economy that Fed officials projected will operate at near stall speed through next year, with an annual growth rate of 0.5% and an unemployment rate nearly a full percentage point higher by the end of 2023, well beyond the increase historically associated with a recession.
After a brutal year for bonds and REITs, income seekers might consider investing in Treasuries, municipal bonds, and high-quality dividend stocks for 2023.
The Federal Reserve is expected to announce yet another interest rate hike aimed at slowing inflation. ABC News business reporter Alexis Christoforous breaks down what it could mean for the economy.
The Federal Reserve raised interest rates Wednesday for the seventh time this year. However, the latest rate hike is slightly lower than the last several increases. CBS News chief White House correspondent Nancy Cordes; Javier David, a CBS News contributor and managing editor of business and markets for Axios; and J.D. Durkin, a host for financial news website TheStreet, discussed the latest move from the nation's central bank.
Recession? It looks like Apple Inc. (NASDAQ: AAPL) didn’t get the message. While many other companies like Meta Platforms Inc. (NASDAQ: META) have declined as much as 70%, Apple has hardly hit bear market territory from its all-time highs. Don’t miss: Never Lose Your Things Again — The Startup Pouring Gasoline on the Apple AirTag In contrast, even powerhouses like Google parent Alphabet Inc. (NASDAQ: GOOGL), and Amazon.com Inc. (NASDAQ: AMZN) have since declined considerably and are trending dow
After a temporary halt, Binance has resumed customer withdrawals for the stablecoin, USDC. That halt came as Binance saw a massive wave of withdrawals. The CEO is trying to calm jittery customers.
Wheat stocks in India's government warehouses will fall by about 13% by early next month from current levels but will be sufficient for welfare schemes of the country, the ministry of consumer affairs and food said on Thursday. Wheat stocks in government warehouses for December fell to the lowest in six years, as prices jumped to a record high on rising demand and falling inventories. India, the world's second-biggest wheat producer, placed a ban on its exports in May.
The Democrat-led National Labor Relations Board in a 3-2 decision threw out a standard that it had adopted in 2017, when it had a majority of Republican appointees, for deciding whether groups of workers with distinct jobs can hold elections to form bargaining units, which some business groups derisively call "micro unions."
Realtors forecast modest 1% drop in 2023 home prices because of supply shortage
The two companies have battled for market share in the industry becoming somewhat fierce competitors. Let's see which stock may be geared to have a stronger performance going forward.
At least four children's hospitals are seeing more cases of invasive group A strep than usual. The CDC said it is hearing anecdotes of a possible rise in infections.
Goldman Sachs cut its price target on Tesla stock to $235 from $305, but maintains its Buy rating as it still sees positive long-term prospects.
Is this the ultimate safe haven?
Tesla investors are growing tired of Elon Musk's Twitter fiasco. And for good reason. The 10 largest investors in the electric-vehicle maker's stock, including ETF giants Vanguard, BlackRock and Musk himself, lost nearly $133 billion since Twitter's board accepted Musk's buyout on April 25, says an Investor's Business Daily analysis of data from S&P Global Market Intelligence and MarketSmith.
Marks became a billionaire by recognizing one of the biggest sea changes in the markets as it was happening—now he’s calling another.

source