The New York Stock Exchange ended Friday with no direction, with the Dow Jones index falling and the S&P500 as a whole heading into correction ahead of a crucial week of the Federal Reserve’s monetary policy meeting.
Final results for the session showed the Dow Jones Industrial Average fell 1.12% and the S&P500 lost 0.48%, putting it in what’s known as a correction at least 10% below its previous high.
The tech-heavy Nasdaq, on the other hand, closed higher with a 0.38% gain, thanks in part to strong results from Amazon, which ended up up 6.83%.
After falling all week, the Dow and S&P500 even posted their second straight weekly loss, but the Nasdaq was the worst performer, losing three weeks in a row.
“Sellers dominate. Investors are waiting for a trend-changing catalyst that could come from the Fed,” predicted Adam Sarhan, an analyst at 50 Park Investments, recalling a meeting of the Fed’s Monetary Policy Committee (FOMC, in its acronym). in English).
A decision on the Fed’s benchmark interest rate is expected on Wednesday, with investors almost unanimously expecting it to remain unchanged but awaiting guidance from Fed President Jerome Powell during a subsequent news conference.
“We’ve seen this before: the market is bearish before the Fed meeting,” Adam Sarhan added. “This is the Fed’s way of saying, ‘stop raising rates’ and ‘give us a break,’” he continued.
The geopolitical situation in the Middle East also put pressure on investor restraint ahead of the weekend.
This Friday, the US attacked two sites used by the Revolutionary Guards and “associated groups” in eastern Syria, and this Friday the Americans shot down a drone in Iraq, near one of the military bases where some of their troops are stationed. a country.
On the economic front, US price performance in September, as measured by the PCE index, was 3.4% annualized and 0.4% monthly, the same as in August, but above expectations.
“This reflects the persistence of service price inflation (excluding energy), which is still too strong to get anywhere near the Fed’s two percent target,” commented Michael Pearce, an analyst at Oxford Economics.