new York Investors on the US stock exchanges went into reverse gear on Friday due to the prospect of further interest rate hikes by the Federal Reserve. The Dow Jones index of standard values closed 0.7 percent lower at 33,727 points. The technology-heavy Nasdaq fell one percent to 13,492 points. The broad S&P 500 lost 0.8 percent to 4348 points.
Speaking to a Senate committee on Thursday, Fed Chairman Jerome Powell signaled that even after ten rate hikes in the US, there is still room for improvement. Investors fear that an overly aggressive interest rate policy could have a lasting impact on the economy. “Recent data has heightened fears of a potential recession, which has further dampened risk appetite,” Deutsche Bank strategists summarized.
Also weighing on sentiment was that the S&P Global Purchasing Managers’ Index for US manufacturing and services activity fell to a three-month low in June.
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