NEW YORK, Sept 17 — Wall Street’s major indexes closed lower yesterday while US Treasury prices climbed as investors’ fears about the prospects for a global recession intensified while they also prepared for a massive US interest rate hike from the Federal Reserve.
“Today is a continuation of what we’ve seen this week, the volatility around the expectations for what the Federal Reserve may do, with 75 basis points baked in and 100 basis points a possibility,” said Megan Horneman, chief investment officer at Verdence Capital Advisors. Paulsen said the FedEx warning had led investors to ask, “what if the Fed’s going to tighten right into a recession.”
The yield curve inversion between the two-year and 10-year notes — seen as a recession harbinger — widened further before returning to Thursday’s closing level. In equities, the Dow Jones Industrial Average fell 139.4 points, or 0.45 per cent, to 30,822.42; the S&P 500 lost 28.02 points, or 0.72 per cent, to 3,873.33; and the Nasdaq Composite dropped 103.95 points, or 0.9 per cent, to 11,448.40.