Live stock market news updates: Stocks plunge as rate jitters dash hopes of year-end rally

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US stocks extended their slide on Monday after shares posted back-to-back weekly losses for the first time since late September.

The S&P 500 (^GSPC) fell 0.9%, while the Dow Jones Industrial Average (^DJI) fell around 160 points, or 0.5%. The tech-heavy Nasdaq Composite (^IXIC) fell 1.5%. The three major averages fell for the fourth straight day to six-week lows.

Monday’s moves follow a sell-off from last week that came after Federal Reserve officials raised its key overnight interest rate by half a percentage point. Fed Chairman Jerome Powell also stressed that interest rate hikes would continue into the new year and that policy will remain tight for as long as it takes to rein in inflation, which remains high, even if that means economic consequences.

The S&P 500 lost 2.1%, the Dow Jones 1.7% and the Nasdaq 2.7% for the week.

“Data showing cooling inflation may have given the market a short-lived boost, but the Fed’s firmness with Powell stressing that rates could stay high for quite some time likely reassured some investors,” Chris Larkin, Director Morgan Stanley’s E*TRADE operations manager, he said in a note.

In other areas of the market, US Treasury yields rose while the US dollar index fell. Oil rose, with West Texas Intermediate (WTI) crude futures rising nearly 2% to trade above $75 a barrel.

Tesla (TSLA) shares closed almost unchanged after rising and falling as much as 3% earlier in the session following CEO Elon Musk’s Twitter poll asking whether he should step down as head of the recently acquired social media platform. Oppenheimer downgraded the stock, calling sentiment “severely hurt.”

Last week, Tesla shares plunged 16%, marking its worst week since the start of the COVID-19 pandemic in March 2020, due to concerns about Musk’s management of Twitter and sales of shares of Tesla. Tesla.

Mega-caps were also under pressure, with Apple (AAPL), Microsoft (MSFT) and Alphabet (GOOG) each down more than 1.5%. Shares of Facebook parent Meta Platforms (META) fell 4.1% after the European Union accused the company of violating antitrust laws by distorting competition in online classifieds markets.

AMC Entertainment (AMC) sank below $5, the lowest level since March 2021.

The company announced Monday that it has raised more than $162 million from its AMC Preferred Equity (APE) units since the program’s inception a few months ago, using the proceeds to pay down debt and fund strategic acquisitions.

On the other hand, shares of Disney (DIS) fell 4.8% to the lowest level since March 2020 after “Avatar: The Way of Water” missed industry expectations of more than $170 million in revenue. for the first weekend.

Shares of Coinbase (COIN) hit a record low of $34.64 during the session and closed down 3.9%.

The US central bank’s message of sustained tight monetary policy has dampened hopes of a Santa Claus rebound, a steady rise in the stock market that occurs around the end-of-year holidays. With the second straight weekly decline on Friday, the S&P 500 is now down nearly 6% month-to-date.

“It’s been a double whammy, it’s been on the Fed and then some weaker economic data, and that’s created an image of a Fed that has been ruthless on inflation and perhaps careless on the economy, not particularly acknowledging how what an impact and how much damage what has already been done so far has had,” Kristina Hooper, director of global market strategy at Invesco, told Yahoo Finance Live. “The general concern is that we are headed for a recession based on what the Fed has already done, and on top of that, the Fed is ready to do more.”

Traders work on the trading floor of the New York Stock Exchange (NYSE) in New York City, U.S., December 14, 2022. REUTERS/Andrew Kelly

Before the markets close for a long Christmas weekend, investors are in for a hectic economic and earnings calendar that may offer further clues as to where the Fed’s policy direction will be in the new year.

This week’s economic calendar will bring investors the latest personal consumption expenditures, or PCE, price index, which is the Fed’s preferred measure of inflation, as well as another GDP reading, a batch of housing data and the Conference Board Consumer Confidence Indicator.

Earnings from Nike (NKE), General Mills (GIS), FedEx (FDX), Micron Technology (MU) and Carnival Cruises (CCL) are also highlights this week.

Alexandra Semenova is a reporter for Yahoo Finance. Follow her on Twitter @alexandraandnyc

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