The prospect of more rate hikes is giving Wall Street a headache. The indices are giving way noticeably. The big tech companies are also suffering from economic concerns. The dollar, on the other hand, can gain.
The shattered hopes of smaller rate hikes by the major central banks have sent Wall Street into a tailspin. Both the US Federal Reserve and its British counterpart, the Bank of England, announced that they would continue to raise interest rates for a longer period of time. The Dow Jones index of standard values closed 0.5 percent lower at 32,001 points. The tech-heavy Nasdaq fell 1.7 percent to 10,342 points. The broad S
Fed Chair Jerome Powell said it was "very premature" to consider pausing rate hikes. The peak in interest rates will therefore probably be higher than previously expected. BoE Governor Andrew Bailey made a similar statement. "The focus is on shifting the discussion from the rate of increases to the level and duration of their hawkish policies. As a result, the rhetoric is now much more aggressive," said Michelle Cluver, portfolio strategist at broker Global X ETFs. "That means the terminal rate is higher, and therefore markets expect rates to stay high for longer."
Interest rate fears and the resulting concerns about the economy drove up the price of the "anti-crisis currency". The dollar index, which reflects the rate against major currencies, gained 1.5 percent to 112.98 points. On the bond market, investors sold the papers of current issues in view of further rising interest rates. Conversely, the yield on the 10-year US Treasury rose six basis points to 4.13 percent.
The papers from Apple, Microsoft and Google's mother Alphabet were down by up to 4.2 percent. According to experts, rising inflation and higher interest rates will devalue the future profits of these high-growth companies. Fear of a slump in demand also pushed the price of light US oil grade WTI by two percent to $88.22 a barrel (159 liters) and North Sea Brent by 1.5 percent to $94.72 a barrel .
In terms of individual values, shares in the biotechnology company Moderna, the streaming company Roku and the mobile chip specialist Qualcomm fell by up to 7.6 percent on disappointing prospects for the end of the year. In contrast, the papers of the cruise company Royal Caribbean and the online marketplace Etsy, which specializes in handicrafts, were asked for quarterly figures, increasing by 8.2 and 14.2 percent respectively. Industrials were also on the up. Airplane maker Boeing climbed more than 6 percent and construction equipment maker Caterpillar rose 2.2 percent.
