News Formal

Stocks Tumble as Fed Signals Fewer Rate Cuts, Yields Surge

  • 📰 globeandmail
  • ⏱ Reading Time:
  • 33 sec. here
  • 7 min. at publisher
  • 📊 Quality Score:
  • News: 33%
  • Publisher: 92%

Business Nyheter

FED,Interest Rates,Treasury Yields

U.S. stocks experienced a sharp decline after the Federal Reserve indicated a reduction in planned interest rate cuts for 2025, prompting concerns about rising Treasury yields. The Fed's revised outlook, which now includes only two rate cuts instead of four, sent shockwaves through the market, leading to a sell-off in stocks and a surge in both yields and the dollar. The decision overshadowed the widely anticipated reduction in the benchmark rate for a third consecutive meeting. The central bank also raised its inflation forecast for next year, potentially paving the way for higher interest rates than previously projected. These developments, coupled with anxieties surrounding President-elect Donald Trump's policies and their potential inflationary impact, have injected uncertainty into the market.

The rally in U.S. stocks is encountering a fresh hurdle -- a potentially problematic rise in Treasury yields as the Federal Reserve signals fewer interest rate cuts for 2025.

Stocks have been buoyed by expectations of easier monetary policy and had previously mostly shaken off the steady rise in Treasury yields. But with benchmark yields hitting 4.52% following the Fed meeting, their highest level in over six months, the rate outlook threatens to undermine the momentum for stocks, which are trading at elevated valuations.

The trajectory of monetary policy is closely monitored by investors, as the level of rates influences bond yields and dictates borrowing costs. Investors said that benchmark yields breaching a key 4.5% level could cause turbulence for stocks and benefit lower-risk alternatives.

Vi har sammanfattat den här nyheten så att du kan läsa den snabbt. Om du är intresserad av nyheterna kan du läsa hela texten här. Läs mer:

 /  🏆 5. in SE
 

Tack för din kommentar. Din kommentar kommer att publiceras efter att ha granskats.

Sverige Senaste nytt, Sverige Rubriker

Similar News:Du kan också läsa nyheter som liknar den här som vi har samlat in från andra nyhetskällor.

Asian Stocks Tumble After U.S. Market SlumpAsian stock markets experienced declines following a sharp drop in U.S. shares. The Federal Reserve's indication of fewer rate cuts in 2025 than previously anticipated contributed to the U.S. market downturn. While the Fed lowered its key rate as expected, other major central banks, including the Bank of Japan, maintained their current rates. The weaker yen against the dollar raised concerns about inflation in Japan, prompting analysts to predict a possible Bank of Japan rate hike in January.
Källa: SooToday - 🏆 8. / 85 Läs mer »

U.S. Stocks Dive as Fed Signals Fewer Rate Cuts in 2025Stocks tumbled after the Federal Reserve indicated a slower pace of rate cuts in 2025, disappointing investors who had anticipated further stimulus for the economy.
Källa: CP24 - 🏆 30. / 67 Läs mer »

Premarket: Global stocks dip on concerns over Fed rate plans, disappointing China retail dataEuropean PMIs weak again
Källa: globeandmail - 🏆 5. / 92 Läs mer »

Premarket: Stocks edge up on Fed cut bets; euro firm ahead of ECB decisionCrude extends gains amid threat of more Russia sanctions
Källa: globeandmail - 🏆 5. / 92 Läs mer »

Fed rate view in focus as robust stocks year draws to closeSome investors brace for ‘hawkish cut’
Källa: globeandmail - 🏆 5. / 92 Läs mer »