Growth Stocks took a Hit from a Jump in Treasury Yields after the Federal Reserve Meeting

Good morning.

U.S. stock index futures declined as growth stocks took a hit from a jump in Treasury yields after the Federal Reserve held interest rates steady while hinting at another hike this year.

The Fed’s updated quarterly projections showed chances of the key rate being lifted one more time in 2023 to a peak range of 5.50%-5.75% and significantly tighter rates through 2024 than previously expected. Some so-call experts refuse once again to believe the FED will raise rates and keep them higher for longer. “While the dot plots suggest upside risks to interest rates, we retain our expectations that the hike cycle is likely done and for the Fed not to raise rates again,” said Mark Haefele Chief Investment Officer, UBS Global Wealth Management.

In Wednesday’s trading session, the benchmark S&P 500 fell to a 3-1/2 week low, and the tech-heavy Nasdaq 100 posted a 3-week low.

Today, all eyes are focused on the U.S. Philadelphia Fed Manufacturing index. Economists, on average, forecast that the September Philadelphia Fed Manufacturing index will come in at -0.7, compared to the previous value of +12.0. U.S. Initial Jobless Claims data will be reported today as well. Economists estimate this figure to be 225K, compared to last week’s value of 220K.

Broadcom fell 5.5% on report Alphabet-owned Google’s executives discussed dropping the company as a supplier of artificial intelligence chips as early as 2027. Meanwhile, Marvell Technology rose 3.4% as the report said Google has been working to replace Broadcom with Marvell as the supplier for networking chips used in its data centers.

WTI crude futures fell below $89 per barrel. Gold weakened below $1,930 an ounce while the yield on the US 10-year Treasury note rose above the 4.4% mark, a new 16-year high. Also, the yield on the 2-year note jumped to 16-year highs, widening the current yield curve inversion.

Have a great day.