Stock Market Update June 2023: Fed Chair Powell Signals More Rate Hikes, Impacting Tech and Energy Stocks
Explore how Federal Reserve Chair Jerome Powell's recent statements on interest rate hikes are influencing U.S. stock markets, with tech stocks falling and energy shares rising amid inflation concerns.
Bill McColl brings over 25 years of expertise as a senior producer and writer across television, radio, and digital platforms, leading teams in delivering impactful news coverage on significant global events.
Highlights from the Market Midday June 21, 2023
- U.S. stock markets showed mixed performance midday as Fed Chair Jerome Powell emphasized the need for further interest rate increases to combat persistent inflation.
- Technology sector shares, including giants like Apple, Meta, Amazon, Microsoft, and Alphabet, experienced declines amid rising borrowing costs.
- Energy stocks, particularly crude oil producers and oilfield services companies, saw gains supported by higher oil prices.
At midday on June 21, 2023, U.S. equities displayed a mixed trend after Fed Chair Jerome Powell informed Congress that additional interest rate hikes are necessary, stating inflation control "has a long way to go." The Dow Jones Industrial Average edged higher, while the S&P 500 and Nasdaq Composite faced downward pressure.
Rising interest rates typically dampen enthusiasm for tech stocks due to increased borrowing expenses. Consequently, all major FAAMG stocks (Facebook/Meta, Apple, Amazon, Microsoft, Google/Alphabet) declined. Shares of Salesforce (CRM) and Tesla (TSLA) also dropped, alongside prominent AI-related companies such as Intel (INTC), Advanced Micro Devices (AMD), and Nvidia (NVDA).
FedEx (FDX) shares fell following a quarterly sales shortfall, and Teleflex (TFX) declined after an analyst downgrade. Conversely, Dollar Tree (DLTR) shares rose after the retailer issued a positive long-term forecast.
Energy sector stocks benefited from climbing oil prices, with companies like APA Corporation (APA), Devon Energy (DVN), and ConocoPhillips (COP) gaining traction. Oilfield service providers Baker Hughes (BKR), Halliburton (HAL), and SLB (SLB) also experienced share price increases. Additionally, equipment manufacturers Caterpillar (CAT), Deere & Company (DE), and United Rentals (URI) advanced.
Commodity markets showed copper prices increasing, while gold and other precious metals declined. The yield on the 10-year U.S. Treasury note rose following Powell’s remarks. The U.S. dollar strengthened against the British pound and Japanese yen but weakened versus the euro. Meanwhile, major cryptocurrencies surged, with Bitcoin rising 11% and Ether up 7%.
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