Treasury yields increase and the Dow drops more than 200 points as traders get ready for Powell's major speech.
prepared for a speech to be given at the annual Jackson Hole conference of the Federal Reserve by Chair Jerome Powell. The broad index fell 0.7%, breaking out of the market range around the record intraday peak reached in July.
The Nasdaq Composite was down 1.2%, and the Dow Jones Industrial Average was down 210 points, or 0.5%. The market is moving on Thursday as it prepares for Powell's address at the Jackson Hole Economic Symposium on Friday, which is expected to provide further details about rate policy.
Based on the CME Group's FedWatch program, traders forecast lower borrowing prices next month. However, they can't agree on whether the reduction will be a tenth of a or one quarter of one percentage point.
The Fed's July meeting minutes, which were made public on Wednesday, will come after that. They stated that, provided information continue to come in as anticipated, the majority of central bank attendees stated that it would "probably" be appropriate to decrease the fed funds rate at the September conference.
Rising bond rates put a downward force on stocks on Thursday as well. Interestingly, the yield on the 10-year U.S. Treasury increased by about 10 basis points to 3.875%. The Dow lost almost 0.1% of its value for the week as a result of Thursday's decline, and the Nasdaq came close to its weekly flatline. Even so, the S&P 500 was up roughly 0.2%.
In business news, Snowflake, a software startup, had a more than 12% decline as operational margins were impacted by growing costs. In spite of this, the business exceeded quarterly projections and increased its estimate for product revenue for the entire year. Following dismal same-store growth in sales in the second quarter, Urban Outfitters saw an additional than 8% decline
To be clear: Rates are anticipated to drop by the Fed from a range of 5.25% to 5.5%.
