US Market extends selloff on rate hike woes

The US stock market finished lower for second straight session on Tuesday, 06 December 2022, as risk aversion selloff continued on growing anxious about the outlook for interest rates ahead of next week's Federal Reserve meeting. Selloff fuelled further on concerns that central bank's aggressive monetary tightening could force the US economy into a recession next year.

The Fed is certain to raise interest rates again on December 14, but it is not clear if the central bank will do so by just a half point or if it will boost rates by three-quarters of a point for the fifth straight time. Continued strength in the ISM Services data and jobs market has some worried that inflation is still not yet under control.

 

At the close of trade, the Dow Jones Industrial Average index stumbled 350.76 points, or 1.03%, to 33,596.34. The S&P500 index decreased 57.58 points, or 1.44%, to 3,941.26. The tech-heavy Nasdaq Composite Index declined 225.05 points, or 2%, to 11,014.89.

Total 10 of 11 sectors of the S&P500 index declined, with energy, communication services, information technology, and consumer discretionary issues being notable losers.

ECONOMIC NEWS: The Commerce Department released a report on Tuesday showing trade deficit widened to $78.2 billion in October from a revised $74.1 billion in September. The wider trade deficit came as the value of exports slid by 0.7% to $256.6 billion, while the value of imports climbed by 0.6% to $334.8 billion.

Among Indian ADR, Tata Motors sank 1.4% to $25.19, ICICI Bank slid 1.3% to $22.57, INFOSYS was down 1.7% at $19.41, WNS Holdings declined 1.5% to $82.34, and Wipro was down 2.4% to $4.92. Dr Reddy's Labs sank 2.8% to $53.24 and Azure Power Global dropped 4.6% to $4.80. HDFC Bank shed 0.25% to $68.22.

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