Wall St. tumbles as investors fret over Fed policy update
By April Joyner NEW YORK (Reuters) - U.S. stocks declined sharply on Wednesday after the Federal Reserve's forecast of fewer interest-rate increases in 2019 fell short of investors' hopes of a more dovish monetary policy. The Dow Industrials closed at their lowest level since November 2017
By April Joyner
NEW YORK (Reuters) - U.S. stocks declined sharply on Wednesday after the Federal Reserve's forecast of fewer interest-rate increases in 2019 fell short of investors' hopes of a more dovish monetary policy.
The Dow Industrials <.DJI> closed at their lowest level since November 2017. The Dow Transports <.DJT> plunged 3.2 percent to confirm bear market territory, down nearly 21 percent from their record high on Sept. 14.
The benchmark S&P 500 index <.SPX> is now down 14.5 percent from its record closing high on Sept. 20. Of its components, 298 have fallen 20 percent or more from their 52-week highs. On the New York Stock Exchange and the Nasdaq, more than 2,000 stocks hit 52-week lows on Wednesday.
Stocks initially seesawed after the Fed's Federal Open Market Committee released its policy statement but accelerated losses after Fed Chairman Jerome Powell spoke at a news conference.
Investors said Powell's remarks that he did not see the central bank changing its policy of keeping its balance sheet run-off on "autopilot" raised concerns of tightening financial conditions placing further strain on financial markets.
"Powell is steadfast in his commentary today that he doesn't see any tightening that stems from the unwinding of the balance sheet," said Quincy Krosby, chief market strategist at Prudential Financial in Newark, New Jersey. "The market message is we are seeing tighter financial conditions and a weaker path for growth."
And while the Fed now expects two rate hikes in 2019, down from three in its previous economic forecasts in September, investors said the slower pace was not enough to calm concerns about the possible negative effects of rising rates as economic growth slackens.
"The market is just kind of recognising the Fed is not throwing them a lifeline anytime soon," said Michael O'Rourke, chief market strategist at JonesTrading in Greenwich, Connecticut.
The Dow Jones Industrial Average <.DJI> fell 351.98 points, or 1.49 percent, to 23,323.66, the S&P 500 <.SPX> lost 39.2 points, or 1.54 percent, to 2,506.96 and the Nasdaq Composite <.IXIC> dropped 147.08 points, or 2.17 percent, to 6,636.83.
All of the S&P 500's major sectors fell. Utilities <.SPLRCU>, real estate <.SPLRCR> and consumer staples <.SPLRCS> posted the smallest percentage declines. The defensive sectors have risen as U.S. stocks have become more volatile in recent months. With Wednesday's losses, only utilities and healthcare <.SPXHC> were in positive territory for the year.
The members of the FAANG group of momentum stocks, which helped lift the Nasdaq on Tuesday, all registered losses. Shares of Amazon.com Inc
Facebook shares dropped 7.3 percent, their biggest percentage decline since July. The New York Times reported that the social media giant allowed some companies far greater access to data than disclosed. The company said the access was provided only after user permission.
Shares of FedEx Corp
Micron Technology Inc
Declining issues outnumbered advancing ones on the NYSE by a 2.58-to-1 ratio; on Nasdaq, a 2.93-to-1 ratio favoured decliners.
The S&P 500 posted no new 52-week highs and 135 new lows; the Nasdaq Composite recorded six new highs and 625 new lows.
Volume on U.S. exchanges was 10.81 billion shares, compared to the 8.22 billion average over the last 20 trading days.
(Reporting by April Joyner; Additional reporting by Chuck Mikolajczak in New York and Amy Caren Daniel in Bengaluru; Editing by Bernadette Baum and Leslie Adler)
This story has not been edited by Firstpost staff and is generated by auto-feed.
By Robin Emmott and John Irish | BRUSSELS/PARIS BRUSSELS/PARIS France and Germany will agree to a U.S. plan for NATO to take a bigger role in the fight against Islamic militants at a meeting with President Donald Trump on Thursday, but insist the move is purely symbolic, four senior European diplomats said.The decision to allow the North Atlantic Treaty Organization to join the coalition against Islamic State in Syria and Iraq follows weeks of pressure on the two allies, who are wary of NATO confronting Russia in Syria and of alienating Arab countries who see NATO as pushing a pro-Western agenda."NATO as an institution will join the coalition," said one senior diplomat involved in the discussions. "The question is whether this just a symbolic gesture to the United States
BEIJING Chinese President Xi Jinping on Wednesday called for greater efforts to make the country's navy a world class one, strong in operations on, below and above the surface, as it steps up its ability to project power far from its shores.China's navy has taken an increasingly prominent role in recent months, with a rising star admiral taking command, its first aircraft carrier sailing around self-ruled Taiwan and a new aircraft carrier launched last month.With President Donald Trump promising a US shipbuilding spree and unnerving Beijing with his unpredictable approach on hot button issues including Taiwan and the South and East China Seas, China is pushing to narrow the gap with the U.S. Navy.Inspecting navy headquarters, Xi said the navy should "aim for the top ranks in the world", the Defence Ministry said in a statement about his visit."Building a strong and modern navy is an important mark of a top ranking global military," the ministry paraphrased Xi as saying.