Wall Street’s ended lower on Thursday, with the NASDAQ dropping more than 2%, as investors reacted to Federal Reserve officials including Chair Jerome Powell offering further signposting of aggressive interest rate hikes this year.
He outlined his most aggressive approach to taming inflation to date, potentially endorsing two or more half percentage-point interest-rate increases while describing the labor market as overheated.
“I would say that 50 basis points will be on the table for the May meeting,” Powell said at an IMF-hosted panel on Thursday in Washington that he shared with European Central Bank President Christine Lagarde and other officials. He said demand for workers is “too hot — you know, it is unsustainably hot.”
Australian shares dropped 1.4 per cent, or 108.5 points, to 7484.3, in early trade, tracking Wall Street and pulling away from a near record high on Thursday.
Ten out of the index’s 11 categories fell with materials the biggest laggard down 3.5 per cent. Industrials stocks were unchanged.
The major banks and mining giants were also under pressure. The AUD was down a little to 73.64. This continues a decoupling if the AUD and commodities, which is worth a more detailed separate post.
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