Contracts on all three major indexes were down to extend a bearish day, spurred by the release of minutes from the Federal Open Market Committee’s (FOMC) meeting December 15 that flagged concerns from policymakers about worsening inflation and signaled more aggressive intervention by the central bank.
Renewed pressures in tech amid interest rate worries sent the Nasdaq spiraling 3.1% in its biggest drop since March, and the S&P 500 shed 1.9%, dragged down by losses in real estate. The Dow Jones Industrial Average tumbled more than 1%, falling for the first time this year.
“We actually like tech for all of 2022 in our outlook, but there’s no doubt that tech is going to take it on the chin when the yield curve does what it does,” Wells Fargo CIO of Wealth & Investment Darrell Cronk told Yahoo Finance Live. “[The response to] Fed meeting minutes suggests that long-duration assets like tech or REITs that are interest-rate sensitive will really come under pressure in moments when you believe the Fed is going to take a more hawkish stance.”
