Wall Street closes the week with notable losses in its main indicators after the rise in interest rates by 75 basis points announced by the US Federal Reserve (Fed).
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The Dow Jones Industrials fell 4% weekly and is at its lowest level of the year, below 30,000 points, and is on the verge of a bear market that was briefly installed this Friday.
The selective S&P 500 falls 4.65% accumulated in the last five days, while the Nasdaq index, which brings together the most important technology companies, is the most affected, with a 5% drop.
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The New York parquet went through a day of great volatility and had its worst moment in the middle of the session, when the dow jones He came to leave almost 800 points that he managed to moderate in the last bars.
The determining factor in the evolution of the markets has been the monetary tightening policies implemented by the Fed and other central banks to control inflation, even if this leads to a recession.
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The Fed raised interest rates again on Wednesday by three-quarters of a point, to 3% and 3.25%, while the Bank of England raised rates by 50 basis points to 2.25% yesterday.
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Analysts point out that among investors the base scenario is beginning to prevail “crash landing”a concept that expresses the rapid slowdown of the economy after a situation of high growth.
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That opinion seems to be shared by financial entities such as Goldman Sachs, which lowered its forecasts for the end of the year in the S&P 500 from 4,300 points to 3,600, anticipating more red days on Wall Street.
In the government bond market, short- and medium-term bond yields soared to highs not seen in more than a decade: on 2-year paper up to 4.266%, and on 10-year paper 3.829%.
Oil was dragged down by the prospect of a recession curbing demand, with Texas slipping below the $80 level to $78.74 a barrel after a sharp weekly drop of more than 7%.
The revaluation of the dollar against other currencies has also had an influence due to the Fed’s policy and volatility, especially against the pound sterling, which fell after the economic plan announced today by London.
The most affected sectors in the weekly set, According to the firm Fidelity, they have been those of non-essential goods (-5.6%), basic materials (-5.2%), real estate (-5.2%) and financial (-5%).
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