Stocks Continue to Fall On Worries Central Banks Will Keep Raising Rates
3:19 pm Tuesday, August 30th, 2022
Stocks fell for a third day, putting a summer market comeback in doubt as the Federal Reserve and other global central bankers continued to signal they will raise interest rates to squash inflation despite the negative consequences for economic growth and, potentially, corporate profits.
The selling interest is broad based with many stocks moving lower. The advance-decline line favors decliners by a 4-to-1 margin at the NYSE and an 8-to-3 margin at the Nasdaq.
Every S&P 500 sector trades in the red with losses ranging from 0.5% (financials) to 4.0% (energy).
Energy complex futures are making big downside moves today, fueling the sizable move in the energy sector. WTI crude oil futures are down 5.9% to $91.25/bbl. Natural gas futures are down 3.0% to $9.05/mmbtu. This comes after Bloomberg reported that the EU is set to meet its gas storage filling goal two months ahead of target. Also, European Commission President von der Leyen said that an emergency intervention is being planned to rein in energy prices.
On an individual basis, retailers Best Buy (BBY) and Big Lots (BIG) have been able to buck the trend with earnings-driven gains. Notably, Baidu (BIDU) is making sizable downside moves after also reporting better-than-expected quarterly results.
Meanwhile, Treasury yields are on the rise but came off their intraday highs. The 2-yr note yield is up two basis points to 3.45% while the 10-yr note yield is unchanged at 3.11%.
The Conference Board’s Consumer Confidence Index rose to 103.2 in August (consensus 97.4) from a downwardly revised 95.3 (from 95.7) in July. This was the first increase in the index in four months. In the same period a year ago, the Consumer Confidence Index stood at 115.2.
