Dow closes down 68.61 points, inflation concerns encourage Fed to keep interest rates high: InfoQuest

The New York Stock Exchange’s Dow Jones index closed negative on Wednesday (September 27) amid choppy trading. The market has been under pressure due to US government bond yields, which rose to their highest level in more than 15 years, as well as fears that rising oil prices could cause inflation and lead the US Federal Reserve to keep interest rates high. For a long time.

• The Dow Jones Industrial Average closed at 33,550.27 points, down 68.61 points, or -0.20%.
• The S&P 500 index closed at 4,274.51 points, up 0.98 points, or +0.02%.
• The Nasdaq index closed at 13,092.85 points, up 29.24 points, or +0.22%.

The yield on ten-year US Treasury bonds jumped to 4.622%, its highest level in more than fifteen years, after the Federal Reserve indicated that it would keep interest rates high for a longer period to stop inflation. High oil prices may also lead to accelerated inflation.

Greg Basak, an analyst at AXS Investments, said market sentiment was affected by concerns that U.S. inflation could prompt the Federal Reserve to keep interest rates high for longer than expected. This will lead to a rise in the cost of borrowing for companies as well, which Basak expects the market will continue to face volatility in the coming weeks. But investors are expected to start buying shares from the end of October until the end of this year.

Peter Toss, analyst at Chase Investment Counsel, commented: Investors are now assessing the situation and whether or not they should start buying shares after the market experienced significant sell-offs in the past. Meanwhile, investors are expected to start buying in the fourth quarter, and the third quarter sell-off in stocks may be coming to an end.

The index of utility stocks, which are sensitive to interest rates, fell 1.9%, while the index of energy stocks rose 2.5% after the price of West Texas Intermediate crude rose more than 3% after the United States revealed that crude inventories fell more than expected.

Shares of Target, a major retailer in the United States, rose 0.25% after the company decided to close some stores in the United States. Due to the problem of product theft by gangs working as a group. The decision aims to protect the safety of customers and employees. And prevent any impact on the company’s operational results.

Investors are watching Congress’ progress in passing the interim budget. If an agreement is not reached by September 30, it will lead to the closure of US government agencies. Or close on October 1

Investors are also watching the US release of 2023 GDP numbers today and the personal consumption expenditures (PCE) price index for August on Friday. Including comments by Mr. Jerome Powell, Chairman of the Federal Reserve, at a town hall meeting. It will be held today US time. To find clear signals about the direction of the Fed interest rate

Regarding the economic data released last night. The US Commerce Department reported that US orders for durable goods, such as aircraft, cars and heavy machinery with a useful life of three years or more, rose 0.2% in August after falling 5.6% in July.

By InfoQuest News Agency (September 28, 2023)

Tags: Dow Jones, Dow Jones, stock market, New York Stock Exchange