Economic comeback plays led the market sell-off after the Federal Reserve pushed up its rate-hike schedule.
 | FRI, JUN 18, 2021 | | | | DOW | | NAME | LAST | CHG | %CHG | | AAPL | 130.46 | -1.33 | -1.01% | | INTC | 55.67 | -1.51 | -2.64% | | JPM | 147.92 | -3.84 | -2.53% | |
| | S&P 500 | | NAME | LAST | CHG | %CHG | | AAPL | 130.46 | -1.33 | -1.01% | | BAC | 38.78 | -1.02 | -2.56% | | GE | 12.78 | -0.22 | -1.69% | |
| | NASDAQ | | NAME | LAST | CHG | %CHG | | AAPL | 130.46 | -1.33 | -1.01% | | AMD | 84.65 | +0.09 | +0.11% | | INTC | 55.67 | -1.51 | -2.64% | |
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The Dow Jones Industrial Average suffered its worst week since October as investors fled shares tied to economic growth in light of the Federal Reserve's hawkish pivot. The market's slide began after the Federal Reserve on Wednesday afternoon added two rate hikes to its 2023 forecast and increased its inflation projection for the year. Stocks extended their losses Friday as St. Louis Fed President Jim Bullard said on CNBC that the first rate increase from the central bank would likely come in 2022. The blue-chip average dropped 533 points Friday, bringing its weekly losses to 3.5%. The S&P 500 fell 1.3%, pushing its loss this week to nearly 2%. The tech-heavy Nasdaq Composite dipped 0.9%.  Pockets of the market most sensitive to the economic rebound led the sell-off this week. The S&P 500 energy sector and industrials dropped 5.2% and 3.8%, respectively, for the week. Financials and materials meanwhile, lost more than 6% each. These groups had been market leaders this year on the back of the economic reopening. "Investors may be interpreting the Fed's hawkish tilt Wednesday as a sign that an extended US post-pandemic economic expansion may be a bit harder to achieve in a potentially emerging environment of less accommodative monetary policy," said Goldman Sachs' Chris Hussey in a note. Bank stocks took a beating from a drastic flattening of the so-called Treasury yield curve when the spread between short-term and long-term rates narrows. The retreat in long-dated bonds reflects less optimism toward economic growth, while the jump in short-end yields shows the expectations of the Fed raising rates. |
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