As Federal Reserve Chairman Jerome Powell warned of an extended period of weak growth and stagnant incomes, the S&P 500 and Dow dove on Wednesday. Powell also dismissed speculation over negative interest rates. “There is a sense, growing sense I think, that the recovery may come more slowly than we would like,” Powell said in a webcast, as he pledged to use more of the central bank’s power, as needed, to support the economy from the pandemic’s hit.
Powell made it clear, however, the Fed won’t push interest rates below zero, as traders had been increasingly betting.
“There you have the chairman of the Federal Reserve that has already thrown trillions of dollars at this issue only accentuating his continued concern, that the disaster we’ve all been fearing is going to happen unless we wake up from this coma,” said Kenny Polcari, chief market strategist at Slatestone Wealth LLC in Jupiter, Florida.
At 10:12 a.m. ET, the Dow Jones Industrial Average was down 161.70 points, or 0.68%, at 23,603.08, the S&P 500 was down 9.76 points, or 0.34%, at 2,860.36. The Nasdaq Composite was up 33.91 points, or 0.38%, at 9,036.46.
Energy, financials and industrials posted some of the steepest percentage losses among the 11 major S&P sectors. Strength in Amazon.com Inc, Apple Inc and Nvidia Corp propped up the tech-heavy Nasdaq.
MacDailyNews Note: After early gains as high as $315.95, Apple shares are down fractionally following Powell’s comments.
Watch Federal Reserve Chairman Powell’s comments earlier today at the The Peterson Institute for International Economics Webcast: