S&P 500 threatens worst one-day drop in about 3 weeks as Powell fails to quell rate-hike fears
U.S. stocks on Tuesday late afternoon were set to the end lower, with the S&P 500 index on pace to book its worst single-session drop since early February after the market's buckled lower following the first public appearance for Jerome Powell as Federal Reserve chairman, replacing Janet Yellen. The S&P 500 index was on track to book its worst drop, off 30 points, or 1.1%, at 2,749, since Feb. 8, according to FactSet data. The Dow Jones Industrial Average looked set to give up about 240 points to 25,465, while the Nasdaq Composite Index was headed for a 1% retreat to 7,343. Powell conveyed an upbeat picture of the U.S. economy but the market focused on his emphasis on coming rate hikes in 2018 and an end to easy-money policies as the central bank tries to stave off rising inflation. The 10-year Treasury following Powell's testimony climbed to 2.90%, while the dollar shot up to gain 0.5% to 90.38, as measured by the ICE U.S. Dollar Index which tracks the buck against a half-dozen other currencies. Bond prices rise as yields fall, with the central bank's comments sparking selling in government debt as investors dumped their holdings in anticipation of richer yields in the future in a rising interest-rate environment. Accelerating yields and a stronger dollar, along with fears of advancing inflation, has been part of a recipe that has dragged on markets since the start of February.
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