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DJI: Dow Jones Sinks 200 Points as Fed Minutes Shake Up Rate Cut Hopes
Key points:
- Dow Jones slips 200 points.
- Fed data shakes up confidence.
- Five more meetings left for Fed moves.
Policymakers cite stubborn inflation and cautioned over cutting rates too soon. With that, markets future traveled and got anxious.
- The Dow Jones Industrial Average
DJI drifted lower Wednesday as investors scaled back their bets spooked by looming uncertainty. The Federal Reserve’s minutes from the central bank’s meeting three weeks ago highlighted growing worries over stubborn inflation. To that end, some policymakers even called for interest rate hikes as a way to tamp down price pressures. - The increased cautiousness over the economic outlook sent investors scrambling. The 30-stock Dow lost 200 points, or 0.5%, pulling further away from its 40,000 milestone hit on May 16. The other two major stock averages also clocked out underwater yesterday. The broad-based S&P 500 erased 0.3% of its valuation and the Nasdaq Composite tanked 0.2%.
- Against that backdrop, investors did some future traveling, which raised their anxiety levels over prospects for interest rate cuts. The Fed is only meeting five more times this year and the probability of a rate cut is getting thinner with each worrying economic report. Still, because the Fed is data dependent, and inflation moderated to 3.4% after the latest minutes, markets keep holding their breath for the good news.