U.S. Markets Sell Off After Fed’s Warsh Says Inflation Is Still ‘Too High’
U.S. stock futures and major indices are rising on Thursday as markets recover from a sell-off triggered by the Federal Reserve's first rate hike in years. While Federal Reserve official Warsh stated inflation remains "too high," investors found relief in the central bank's active efforts to contain price growth. The rally is further supported by falling oil prices and easing bond yields, helping stocks claw back nearly all losses sustained earlier in the week. Asian markets are expected to fall as the U.S. dollar jumps following the hike.
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- ✓ The Federal Reserve implemented its first rate hike in years on Wednesday.
- ✓ U.S. stock futures and major indices including the Dow, S&P 500, and Nasdaq are rising on Thursday.
- ✓ Fed official Warsh stated that inflation is still "too high".
- ✓ Falling oil prices and easing bond yields are contributing to the market rally.
What changed
U.S. markets have entered a recovery phase following an initial sell-off caused by a Fed rate hike and comments from Warsh.
Live updates
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U.S. Stocks Recover After Fed Rate Hike and Warsh Inflation Warning
U.S. stock futures and major indices are rising on Thursday as markets recover from a sell-off triggered by the Federal Reserve's first rate hike in years. While Federal Reserve official Warsh stated inflation remains "too high," investors found relief in the central bank's active efforts to contain price growth. The rally is further supported by falling oil prices and easing bond yields, helping stocks claw back nearly all losses sustained earlier in the week. Asian markets are expected to fall as the U.S. dollar jumps following the hike.
Why it matters
The Federal Reserve's shift toward a hawkish stance aims to stabilize inflation but initially rattled Wall Street. This tension highlights the struggle between necessary interest rate increases and their immediate negative impact on equity valuations.
What is confirmed
- The Federal Reserve implemented its first rate hike in years on Wednesday.
- U.S. stock futures and major indices including the Dow, S&P 500, and Nasdaq are rising on Thursday.
- Fed official Warsh stated that inflation is still "too high".
- Falling oil prices and easing bond yields are contributing to the market rally.
Still unconfirmed
- Donald Trump is fuming over the hawkish Fed and Warsh's impact on stocks.
- Asian stocks are expected to fall as the dollar jumps.
What to watch next
- Further commentary from Fed officials on the trajectory of future rate hikes
- Performance of AMD and Bloom Energy at identified buy points
- Closing data for the weekly recovery of U.S. indices
confidence 90%Sources used for this update (8)
- WSJ — U.S. Markets Sell Off After Fed’s Warsh Says Inflation Is Still ‘Too High’
- Reuters — COMMENTARY: Trading Day: Lift off!
- Investor's Business Daily — Dow Jones Futures Rise After Hawkish Fed, Warsh Hit Stocks, Trump Fumes; AMD, Bloom Energy Eye Buy Points
- Investing.com — U.S. stock futures rise after hawkish Fed dents Wall St
- Bloomberg.com — Asian Stocks to Fall as Fed Hikes, Dollar Jumps: Markets Wrap
- finance.yahoo.com — Stock market today: Dow, S&P 500, Nasdaq rise as oil slips, Fed rate hike pacifies markets' inflation worries
- finance.yahoo.com — Stocks are in recovery mode after the Fed's first rate hike in years rattled markets
- www.orlandosentinel.com — US stocks rally to their best day in 6 weeks after oil prices and bond yields ease
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