Stock Market This Week (US): US markets ended 4% lower for the week amid rate hike concerns

Stock Market This Week
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Stock Market This Week (US)

It was a roller coaster week for investors. The ride ended with a heavy blow on Friday. For the week, all major indices closed in red with Dow Jones falling 4.2%, S&P 500 falling 4%, and Nasdaq100 fell 4.4%.

US stock market this week: Stocks movement this week

The US stock market closed lower on Monday led by large-cap tech stocks. All three major stock indexes ended in the red. Investors are apprehensive about the annual Jackson Hole Symposium of the Fed later in the week.

Stocks fell on Tuesday following their worst day since June as both S&P500 and Dow declined for a third straight session. The worst performing sectors for the day were Communication Services and Health Care. The energy sector gained the most.

The US stocks increased for the first time in the week on Wednesday as investors awaited clarity from the Federal Reserve. Crude oil futures continued to gain after Saudi Arabia suggested the OPEC+ alliance may make possible cuts to production.

The US stocks extended the rally to the second day on Thursday. Materials, communication services, and IT outperformed, while Consumer staples underperformed the broader market index. Investors look for clues on whether policymakers will cut rates when the current hiking cycle is over.

The US stock market crashed on Friday after Fed Reserve Chair Jerome Powell said in his speech the central bank won't back off in its fight against rapid inflation. All major indices fell more than 3%.

US stock market this week: Major events

Earning Season: The earning season is almost over. Peloton share price tanked 21% after it reported wider-than-expected losses, while Snowflake's share price increased 24% after beating quarterly estimates. Nvidia stock fell 9% reported revenue and profit lower than estimates. The company also issued weak revenue guidance for the next quarter. Gap and Dell share price also tumbled after its June quarter revenue missed analysts' estimates.

Powell on inflation: The investors waited for the Fed comments on inflation control this week. Sadly, it did not turn out to be good news for investors. Fed's chairperson's comments were “resolutely hawkish,” and he confirmed that he perceives taming inflation as the bedrock of the recovery.

Yield curve: The shorter end of the yield curve, which tends to reflect Fed policy, moved higher, with the 2-year yield up to 3.40%. The longer end of the curve, which reflects more the longer-term growth outlook for the economy, moved lower, with the 10-year yield moving down 1 basis point (0.01%) to 3.03%.

July PCE data: PCE (Personal Consumption Expenditure) readings were in line with the broader trend. Similar to the July CPI and PPI readings, headline, and core PCE inflation came in slightly below expectations on both a year-over-year and month-over-month basis.

Other economic data: Sales of new homes in July fell for the sixth month so far this year to the slowest pace since early 2016. Both personal income and spending rose much less than consensus expectations (0.2% versus roughly 0.6% and 0.1% versus 0.4%).

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  • How has the US market performed this week?

  • What will be the interest rate by the end of the year?

  • Have oil prices fallen this week in the US?

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