U.S. stocks fell on Friday with the Dow Jones Industrial Average on pace to post its worst week since January, as economic comeback plays led the market selloff after the Federal Reserve pushed up its rate-hike schedule.
The 30-stock index dumped 428.68 points, or 1.3%, to open the last session of a rough week at 33,394.73, bringing its week-to-date losses to 2.8%.
The S&P 500 swooned 35.11 points to 4,186.75, pushing its loss this week to more than 1%.
The NASDAQ lost 64.18 points to 14,097.17.
Stocks extended their losses as St. Louis Fed President James Bullard told the media it was natural for the Fed to tilt a little “hawkish” this week and that the first rate increase from the central bank would likely come in 2022.
The market’s slide began after the Federal Reserve on Wednesday afternoon added two rate hikes to its 2023 forecast and increased its inflation projection for the year.
This phenomenon is hurting bank stocks particularly as bank earnings could take a hit when the spread between short-term and long-term rates narrows. Goldman Sachs’ shares fell more than 1% Friday, while JPMorgan and Morgan Stanley fell 2% each.
Chip stocks, which have had a good week, looked set to continue their run on Friday with shares of Nvidia higher by about 1%.
Adobe shares gained about 3% after earnings and revenue topped estimates.
Friday also coincides with the quarterly “quadruple witching” in which options and futures on indexes and equities expire. Many expect trading to be more volatile in light of this event.
Prices for 10-Year Treasurys were higher, bringing down yields to 1.50% from Thursday’s 1.52%. Treasury prices and yields move in opposite directions.
Oil prices recovered 89 cents to $71.93 U.S. a barrel.
Gold prices slipped $1.70 to $1,773.10 U.S. an ounce.