Dow adds 500+ points, Fed rate hike taken in stride
The Fed increased the short-term interest rate by 0.25 percentage points
Nicole Webb, Gary Kaltbaum and Phil Blancato react to the Federal Reserve raising the fund rate by 25 basis points on 'Making Money.'
U.S. stocks added onto gains late in the session after the Federal Reserve raised interest rates for the first time since 2018 a sign the U.S. economy is in good shape even as Chairman Jerome Powell signaled the need to bring down inflation.
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| I:DJI | DOW JONES AVERAGES | 43444.99 | -305.87 | -0.70% |
| SP500 | S&P 500 | 5870.62 | -78.55 | -1.32% |
| I:COMP | NASDAQ COMPOSITE INDEX | 18680.120875 | -427.53 | -2.24% |
The Dow Jones Industrial Average rose over 500 points or 1.5%, while the S&P 500 and Nasdaq Composite gained 2.2% and 3.7%.
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Oil prices bounced around with U.S. crude dropping 1.4% to $95.04 per barrel, while Brent, the global benchmark, traded down 1.9% to $98.02 level.
Oil storage containers are seen in Los Angeles, California. (Reuters/Lucy Nicholson/Files)
The Fed, as expected, raised its key short-term rate by 0.25 percentage points and signaled rates would hit 1.9% by year-end marking the start to a series of about six rate hikes this year. Policymakers also indicated the Russia Ukraine conflict is adding "economic hardship" and creating "additional upward pressure."
The 10-year Treasury yield rose to 2.18%, a new 52-week high.
Investors also weighed Russia and Ukraine as President Volodymyr Zelenskyy addressed members of Congress.
WHAT DOES A FEDERAL RESERVE INTEREST RATE HIKE MEAN FOR MAIN STREET?
Federal Reserve Chairman Jerome Powell
In stocks, Starbucks CEO Kevin Johnson is retiring and will be replaced on an interim basis by Howard Schultz, who helped grow the coffee giant into a global brand. He also dabbled in politics and considered a presidential run.
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| SBUX | STARBUCKS CORP. | 98.42 | -0.20 | -0.20% |
Boeing rose after favorable comments on the stock from Baird.
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| BA | THE BOEING CO. | 140.19 | +2.05 | +1.48% |
Pfizer and partner BioNTech have asked the Food and Drug Administration to approve a second COVID-19 booster shot.
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| PFE | PFIZER INC. | 24.80 | -1.22 | -4.70% |
| BNTX | BIONTECH SE | 99.72 | -3.84 | -3.71% |
WHOLESALE PRICES SOAR 10% IN FEBRUARY, HIGHEST LEVEL ON RECORD
Shares of Alibaba, JD.com and Didi Global rose after China’s government tried to reassure jittery investors by promising support for its struggling real estate industry, internet companies and entrepreneurs after regulatory crackdowns.
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| BABA | ALIBABA GROUP HOLDING LTD. | 88.57 | -1.97 | -2.18% |
| JD | JD.COM INC. | 35.00 | +1.65 | +4.95% |
| DIDI | NO DATA AVAILABLE | - | - | - |
Retailers were active after sales for February rose 0.3% month-over-month, after a larger-than-expected gain of 3.8% in January. Excluding the automotive component, spending rose 0.2%, down from January’s 3.3% pop. Both components came in weaker than expected. Separately, Walmart announced plans to hire 50,000 workers in "stores, clubs, campuses and supply chain facilities" as it continues to ramp up staffing.
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| WMT | WALMART INC. | 84.27 | -0.20 | -0.24% |
| TGT | TARGET CORP. | 152.16 | -1.30 | -0.85% |
| KSS | KOHL'S CORP. | 18.02 | -0.59 | -3.20% |
In other economic news, prices of imported goods rose 1.4% month-over-month, trailing January’s 2% increase. Export prices rose 3%.
The National Association of Homebuilders fell below a reading of 80 for the first time since September as rising costs for materials create headwinds for new construction.
In cryptocurrencies, Bitcoin crossed back above the $40,000 level.
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FOX Business' Ken Marin and The Associated Press contributed to this report.