Stock Bulls Reluctantly Fold on Fed’s Grim Economic Message
- S&P plunges 1.7% in worst Fed-day showing since January 2021
- Risk assets will suffer in ‘sharper, shorter’ cycle: Jones
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It took longer than it should, but stock traders finally heeded the Federal Reserve’s latest message: The inflation battle will cause real economic pain.
After rising as much as 1.3% when the Fed delivered its third straight 75-basis point hike, the S&P 500 plunged into the close as Jerome Powell made it crystal clear that the central bank is going to keep raising rates sharply -- until officials see signs that price pressures are easing. That’s a process that won’t be “painless” for the labor and housing markets, the Fed chief warned.