U.S. stocks drop for 4th straight session on recession fears
Dec 20, 2022
New York [US], December 20: Wall Street's major averages fell on Monday for the fourth consecutive session, as recession fears gripped markets.
The Dow Jones Industrial Average dipped 162.92 points, or 0.49 percent, to 32,757.54. The S&P 500 sank 34.70 points, or 0.90 percent, to 3,817.66. The Nasdaq Composite Index shed 159.38 points, or 1.49 percent, to 10,546.03.
Ten of the 11 primary S&P 500 sectors ended in red, with communication services and consumer discretionary down 2.18 percent and 1.66 percent, respectively, leading the laggards. Energy rose 0.13 percent, the lone gaining group.
Investors assessed the likelihood of a looming U.S. recession.
Last week, the Federal Reserve raised rates for the seventh time this year and signaled more hikes are to come next year.
Its updated economic projections showed that policymakers saw benchmark rates rising to a median level of 5.1 percent in 2023, above the 4.6 percent forecast back in September.
In addition, Fed officials downgraded next year's growth forecast to 0.5 percent from the previous estimate of 1.2 percent.
"With rates going up higher, and likely being held there for longer, the reduced GDP forecast doesn't leave much room for downside error, as that's awfully close to no growth or contraction status," Kevin Matras, executive vice president at Zacks Investment Research, said in a note on Monday.
"And if output declines, we're talking about another recession, after having just exited this last one. And that spooked the market," he said.
For the week ending Friday, the Dow fell 1.7 percent, the S&P 500 lost 2.1 percent and the Nasdaq dropped 2.7 percent.
Source: Xinhua
