June 27, 2022

Market and Financial News

Market and Financial News Aggregator

Wall Street stocks tumble as UK and Switzerland follow Fed with rate rises

2 min read

Wall Street stocks sold off sharply on Thursday as Switzerland and the UK joined a global rush to raise interest rates, following a sharp boost to borrowing costs by the US Federal Reserve as central banks attempt to tame high inflation.

The S&P 500 slid 3.3 per cent, in a move that put the broad gauge on track for a weekly fall of more than 6 per cent — its biggest decline since March 2020. The declines have accelerated in recent days as pessimism about the global economic outlook has spread, with many investors warning central bank action could stamp out the recovery.

In a sign of the darkening outlook, almost every stock in the S&P 500 index declined on Thursday, with losses pushing the share prices of hundreds of companies in the US down to new 52-week lows. The technology-heavy Nasdaq Composite tumbled 4.1 per cent.

The S&P had closed the previous session 1.5 per cent higher after the Fed raised its main interest rate by 0.75 percentage points, with chair Jay Powell saying he expected rises of this magnitude to be relatively uncommon.

However, in the latest sign of how central banks are stepping up their efforts to tackle scorching inflation, the Fed’s decision was followed on Thursday by the Swiss National Bank raising its policy rate for the first time in 15 years — topping forecasts with a 0.5 percentage point increase.

“The SNB has for so long been in the ultra-dovish camp,” said Francesco Pesole, a currency strategist at ING. “If even they are hiking, it’s sending a message to markets that central banks are looking at this summer as their last chance to do something about inflation before we hit a global slowdown.”

The Swiss franc rose 2 per cent against the euro on Thursday to €0.98.

Europe’s regional Stoxx 600 share index, which had rallied on Wednesday after the European Central Bank promised a new mechanism to support weaker eurozone nations from rising interest rates in the bloc, fell 2.7 per cent.

Sterling added 0.8 per…

2022-06-16 11:29:30

All news and articles are copyrighted to the respective authors and/or News Broadcasters. VIXC.Com is an independent Online News Aggregator

Read more from original source here…

Leave a Reply

Copyright © All rights reserved. | Newsphere by AF themes.