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The S&P 500 fell on Friday and was on track to end the week lower, with technology stocks under pressure as inflation concerns remain front and center ahead of the Federal Reserve’s policy meeting next week.
The broad market index lost 0.6%. The Dow Jones Industrial Average dipped 190 points, or 0.4%. The Nasdaq Composite slipped 0.8%. The S&P 500 is down roughly 0.3% from the start of the week, while the 30-stock Dow and Nasdaq have shed 0.2% and 0.7%.
Tech shares were broadly lower, with Apple and Microsoft down more than 1% and 2%. Shares of Amazon and Google-parent Alphabet also fell. Nvidia bucked the trend, however, climbing more than 1%. The chipmaker has whipsawed this week as traders worry about the stock’s valuation and book profits in the high-flying name.
Investors remain hyper vigilant after a slew of data from earlier in the week. February’s producer price index, a gauge of wholesaler inflation, advanced more than economists anticipated. The data has helped push the the benchmark 10-year Treasury roughly 22 basis points higher on the week, as investors wondered if the recent economic data was too strong for the Federal Reserve to loosen monetary policy. The Fed will begin its two day policy meeting on March 19.
Recent economic releases could throw into question whether the Fed feels inflation has cooled enough to begin lowering levels later this year and could raise long-term borrowing rates, according to Macquarie global FX and rates strategist at Thierry Wizman.
“I think the other issue here is not just the 2024 and 2025 [dot plot], its the other issues that the Fed is thinking about which includes that the market is too frothy,” Wizman said. “For that reason it could signal that it thinks long-term interest rates should be higher.”
To be sure, fed funds futures are pricing in a 99% likelihood of the central bank keeping interest rates unchanged at its policy meeting next week, according…
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