Frankfurt Recession worries ahead of another major rate hike by the US Federal Reserve are driving Wall Street investors to caution. The Dow Jones gained 0.6 percent on Monday to 31,020 points. The tech-heavy Nasdaq advanced 0.8 percent to 11,535 points and the broad-based S&P 500 gained 0.7 percent to 3,900 points. Investors feared another massive rate hike by the Fed could plunge the US economy into recession.
The S&P 500 and Nasdaq on Friday posted their sharpest weekly percentage declines since June, as market traders have now firmly priced in a rate hike of at least 0.75 percentage points at Wednesday’s Fed meeting. Even a plus of a full percentage point is no longer ruled out by stockbrokers. “I think a recession is very likely. The Fed views a recession as unfortunate but inevitable to fight inflation,” said Christopher Grisanti, equity strategist at MAI Capital Management.
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