The S&P 500 fell on the week in the wake of Fed Chair Jerome Powell’s testimony to Congress that Federal Open Market Committee’s members agree that “it will be appropriate to raise interest rates somewhat further by the end of the year.”
The drop was the index’s largest loss in all of June, breaking a weekslong winning streak for the general market gauge. Other indexes also saw a week of losses. The Dow Jones was also down 2% weekly on Friday and the tech-heavy Nasdaq Composite had lost over 2.6% on the week by deadline.
The tech sector saw $2 billion in outflows in the five trading days ending June 21, the largest in 10 weeks.
Powell’s words were taken with disappointment after the Federal Open Market Committee’s decision to pause interest rate hikes for the first time since March 2022, spreading a wave of optimism for investors across sectors.
Further raises to interest rates are expected to come from central banks across the globe as inflation proves sticky for most economies.
Washington, D.C. received a high-profile visit from India’s Prime Minister Narendra Modi, who was welcomed with great emphasis by the Biden administration. Biden said the relationship between the U.S. and India “will be one of the defining relationships of the 21st century” as India rises to the top as one of the world’s most influential economic and military powers.
FedEx Corp.’s earnings call caused mixed emotions as the company reported a revenue drop of 10.2% ($21.9 billion) for the fourth quarter, coming in below analyst estimates of $22.7 billion. Earnings of $4.94 per share beat estimates of $4.89 per share.
Remember Bitcoin?
The cryptocurrency embarked on a massive rally, gaining almost 20% weekly on Friday, breaking the psychological $30,000 barrier and reaching $31,200 after the announcement of new crypto initiatives by several financial services institutions.
What’s next
On Tuesday, the New Home Sales report will lend a view into the real estate market for the month of May. On Thursday, the Personal Consumption Expenditures index will give a window into the Fed’s preferred inflation measure.
Walgreens reports earnings Tuesday, while semiconductor chips manufacturer Micron Technologies will release its results on Wednesday, along with food giant General Mills. Sports apparel colossus Nike will post earnings Thursday, while beverage giant Constellation Brands reports Friday.
