September 28, 2022

Dow falls 300 points as Wall Street sell-off continues

Stocks fell on Monday as rising rates and tighter monetary policy added fuel to a rout that began in the previous session.

The Dow Jones industrial average fell 300 points, or about 1%. The S&P 500 and Nasdaq Composite fell 0.95% and 1.2%, respectively.

Technology and financials were the worst performers among the S&P 500 sectors. Dow Inc and 3M led the 30-share Dow Industrials to fall.

Wall Street suffered a Friday sharp sellingShort and blunt comments from Federal Reserve Chairman Jerome Powell in Jackson Hole, Wyoming, extinguished any hope that the central bank would reverse its aggressive rate hikes in the coming months.

The Dow fell 1,008 points, or more than 3%, for its worst day since May. The S&P 500 and Nasdaq Composite fell 3.4% and 3.9%, respectively. The decline wiped out August’s gains for all three averages.

“At the very least, pain will be the name of the game. While the test for the June 16 low is now underway, we don’t expect the S&P 500 to decline much,” said Sam Stovall, chief investment officer. Strategist at CFRA Research. However, he noted, “For the month to August 25, US stocks fared better than investors expected, especially following such strong earnings in July and uncertainties from multiple fronts.”

Meanwhile in Europe over the weekend, Isabelle Schnabel, a member of the European Central Bank’s board, warned that central banks must fight inflation – even if it pushes economies into recession.

Fed speeches abound this coming week, including Vice Chairman Lael Brainard on Tuesday, ahead of Friday’s August nonfarm payrolls report.