Published Every MondaySince 2007| Volume 826 |September 26, 2022
So far YTD these many weeks were markets were up (Bull picture shown), down (Bear picture), or draw (Bull/Bear picture) … Bulls (Markets UP) = 16… Bears (DOWN) = 22… and Draw = 0
Markets slide continues – The DOW lost 1132 points for the week
SP&500 closed down -157 points or -4.1%, the DOW down -1132 points or -3.7%, and the NASDAQ -471 or -4.2% for the week ending September 22nd. Oil dropped -$5.97 or -7.0% to $79.43 per barrel on the news that aggressive interest rate hike may slow down the US economy to a recession, thus reducing the oil demand.
The aggressive interest rate hike of 0.75% by the Federal Reserve spooked many investors that the recession appears to be inevitable, thus fled from the stocks to safer cash or bond position. The stocks tumbled close to 4% across the board!
As most predicted, the Feds raised key interest rates by 0.75% the 3rd time in a row and 5th this year to address stubborn inflation
The Fed Chair of the Federal Reserve, Mr. Jerome Powell, for the third time in a row raised the interest rate by 0.75% to address the rising interest rate. In August inflation rose 8.3% annually which was lower than July 8.5% but this was considered to be an issue that the Federal Reserve Bank is determined to address aggressively to tamper the economy and the rising inflation.
The Federal Reserve is on track to increase one more time 0.75-1.00% increases in 2022. Expect the rates to be closer to 4.0% by the end of 2022. The main street is already seeing the effect. The 30-year fixed mortgage is now 7.5% and expected to rise. The rise in interest rates have started to slow down the hot housing market as higher mortgage rates make the monthly payments higher for the home buyers.
The Federal Reserve has concluded its long running asset-buying program to focus on curbing inflation.