Dow loses 1.5 per cent as stocks fall again on worries over higher interest rates
Wall Street stocks fell for the second straight session Wednesday amid worries about higher interest rates and as petroleum-linked shares tumbled on lower oil prices.
The Dow Jones Industrial Average dropped 1.5 per cent to close at 25,028.37, the broad-based S&P 500 shed 1.1 per cent to finish at 2,713.81, and the tech-rich Nasdaq Composite Index fell 0.8 per cent to 7,273.01.
The declines followed a drop Tuesday after congressional testimony from new Federal Reserve Chairman Jerome Powell sparked talk the US central bank would accelerate its pace of interest rate hikes.
Those worries also dogged markets on Wednesday, analysts said.
“I think it’s just a concern about higher interest rates,” said Jack Ablin, chief investment officer at Cresset Wealth Advisors.
“Unfortunately, we may have to wait for first quarter earnings to kind of break out of the cycle we’re in.”
Petroleum-linked equities fell sharply following a bearish US oil inventory report, with Dow member ExxonMobil, ConocoPhillips and Halliburton all losing more than two per cent.
Other Dow companies with large declines included American Express, Caterpillar, General Electric and DowDuPont.
Among companies that reported earnings, Lowe’s Companies sank 6.5 per cent, while TJX Companies and Booking Holdings both surged 7.0 per cent.
Biotech company Celgene slumped 9.0 per cent after disclosing that it hit a stumbling block in the government review of its ozanimod medication for multiple sclerosis.
The company said it would work with the US Food and Drug Administration to meet the agency’s concerns.
Dick’s Sporting Goods gained 0.7 per cent after announcing it would stop selling assault-style rifles and bar all gun sales to customers under 21 years old.