Automakers plummet: US investors hunker down before rate hike

Wall Street starts an eventful week with losses.

Automakers plummet: US investors hunker down before rate hike

Wall Street starts an eventful week with losses. Tech stocks in particular are going down. Car manufacturers are under pressure because of the price war started by Tesla.

Wall Street investors are cashing in ahead of the Federal Reserve's expected rate hike this week. After the rally at the beginning of the year, technology stocks were at the top of the sales lists at the start of the week. These had recently caught up significantly as cooling inflation and a slowdown in the economy gave investors hope for a slower pace of interest rate hikes. The Dow Jones index of standard values ​​closed 0.8 percent lower at 33,717 points. The technology-heavy Nasdaq fell two percent to 11,393 points. The broad S

Market traders expect the US Federal Reserve to raise interest rates by 25 basis points on Wednesday. The European Central Bank (ECB) and the Bank of England are each expecting interest rate hikes of 50 basis points on Thursday. "I find it remarkable that for the first time in a long time the ECB is likely to be more aggressive than the Fed," said Commerzbank analyst Ulrich Leuchtmann. At the start of the central bank week, investors in Europe were also on guard. The Dax went 0.2 percent weaker with 15,126 points from trading.

Individually, Ford spooked investors by dropping the price of its electric-powered Mustang. The price war for electric cars fueled by Tesla is thus gaining momentum. In response to the world's largest electric car maker, Ford slashed prices on its Mustang Mach-E SUV by up to $5,900. Ford shares fell nearly 3 percent. Tesla's titles have lost more than six percent. Car companies such as General Motors and Rivian Automotive lost three to nine percent.

Johnson meanwhile set a defeat in court in the legal dispute over the allegations made that his talc products such as baby powder are carcinogenic

Chip maker shares also fell. Advanced Micro Devices, Nvidia, Intel and Qualcomm each fell between around one and six percent. "There is a slowdown in chip demand and there is concern that this will translate into earnings after a strong rally late last year and early January," said Ipek Ozkardeskaya, an analyst at Swissquote Bank.