Stocks Poised For Losing February As Bank Of America Warns Fed Could Raise Rates To Nearly 6%

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The Dow, S&P and Nasdaq each slipped in February, paring January’s massive gains as more experts worry inflation could force the Fed to act more aggressively.

Major stock indexes fell in February as Wall Street digested the latest round of corporate earnings and reacted to growing expectations the Federal Reserve may hike interest rates higher than anticipated, a potential nightmare for stock prices as borrowing costs slash into profits.The Dow Jones Industrial Average, S&P 500 and tech-heavy Nasdaq each fell this month, with each index largely flat in Tuesday trading.

The Dow was the worst-performing index with a 4% monthly loss, while the S&P and Nasdaq fell 2% and 1%, respectively. The deterioration in equity prices came amid a historically bad earnings season as companies reported financials from the last stretch of 2022. Companies listed on the S&P beat consensus analyst sales and profit estimates at their lowest rate since early 2020 in the most recent financial period, according to data compiled by JPMorgan last week.

Perhaps more worrisome for investors is the fact that less than 30% of companies revised profit guidance higher, also a three-year low, according to JPMorgan data.

 

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