Stocks fell Wednesday as investors took a breather from last week’s market rally, and weighed Federal Reserve Chair Jerome Powell’s latest comments on inflation.
Powell said Wednesday that more rate hikes are likely ahead as the central bank tries to combat inflation. Those comments come after the conclusion of last week’s meeting when the central bank held off from raising rates after 10 straight consecutive hikes. However, officials indicated there could be two more quarter-percentage point moves on the horizon this year.
The Dow Jones Industrial Average was lower by 102.35 points, or 0.30 per cent. The S&P 500 dropped 0.52 per cent while the Nasdaq slid 1.21 per cent . It was the third consecutive day of losses for the three indexes.
Some major tech stocks that enjoyed an extraordinary run because of enthusiasm around artificial intelligence pulled back. Amazon shares dropped about 0.8 per cent after the Federal Trade Commission on Wednesday sued the online retailer. The agency alleged that Amazon fooled millions of shoppers into signing up for Prime, and then hindered their attempts to cancel. Nvidia, which is up nearly 200 per cent this year, slid 1.7 per cent. Shares of Google-parent Alphabet and Netflix were each down by more than 2%.
Elsewhere, FedEx shares fell more than 2 per cent a day after the shipping giant posted weaker-than-expected revenue for its most recent quarter.
In other news, The Pharmaceutical Research and Manufacturers of America is suing the US over a law that hands the federal government the power to negotiate prices for some of the most expensive drugs.
The lobby group said on Wednesday it has filed a joint complaint with two patient groups in the US District Court for the Western District of Texas, which argues a key part of the Biden administration’s drug pricing reforms are unconstitutional.
The Norwegian government on Tuesday opened the door for deep-sea mining in its waters, despite opposition from environmental groups and a growing list of nation states arguing to ban the practice.
The government said it was proposing parts of the Norwegian continental shelf be opened for deep sea mining and other commercial seabed mineral activities. It added that environmental considerations would be safeguarded and extraction would only be permitted if the industry could demonstrate “sustainability and responsible practices.
In EV news, the electric vehicle sector is the standout performer in the global auto industry, with projected sales of over 13 million vehicles in 2023, while Mainland China’s lithium production is expected to grow steadily, but the global supply of lithium is anticipated to fall short of demand by 2025, leading China to rely more on foreign supply.
Futures
The SPI futures are pointing to a 0.1 per cent fall
Currency
One Australian dollar at 7:15 AM was buying 67.94 US cents.
Commodities
Iron ore futures are pointing to a 0.9 per cent fall.
Gold lost 0.07 per cent. Silver dropped 0.41 per cent. Copper lost 0.17 and oil was down 0.06 per cent.
Figures around the globe
Across the Atlantic, European markets closed lower. London’s FTSE fell 0.13 per cent, Frankfurt lost 0.55 per cent while Paris closed 0.46 per cent lower.
In Asian markets, Tokyo’s Nikkei added 0.56 per cent, Hong Kong’s Hang Seng lost 1.98 per cent while China’s Shanghai Composite closed 1.31 per cent lower.
Yesterday, the Australian sharemarket closed 0.58 per cent lower at 7315.
Sources: Bloomberg, FactSet, IRESS, TradingView, UBS, Bourse Data, Trading Economics, CoinMarketCap.
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