US STOCKS-Wall St rides roller-coaster on hawkish Fed, ends down

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22/09/2023 21:00

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        * 
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talks
    

        * 
      Alibaba jumps on report of Cainiao Hong Kong IPO
    

        * 
      U.S.-listed Chinese shares rise on signs of economic
rebound
    

  
 (Updated at 4:00PM ET)
    By Stephen Culp
       NEW YORK, Sept 22 (Reuters) - 
    Wall Street see-sawed on Friday, and closed slightly lower
after a tumultuous week during which benchmark Treasury yields
hit 16-year highs as investors digested the Federal Reserve's
hawkish outlook revisions.
  
        All three major U.S. stock indexes oscillated for much
of the session and posted weekly losses. 
  
    On Thursday, the S&P 500 dipped below its 100-day moving
average - a key support level - for the first time since March,
Its failure to break above that level suggests the index is
still under downward pressure.
        "This week is about some Fed messaging colliding with
overly optimistic equity investors," said Zachary Hill, head of
portfolio management at Horizon Investments in Charlotte, North
Carolina. 
  
        Hill added that investors have "wanted to trade peak
interest rates for almost a year now." But he said it was clear
in remarks this week by Fed Chair Jerome Powell "and in the dot
plot that the Fed doesn't think we’re there yet."
  
        "This week’s stock action has been about digesting that
reality."
  
    Benchmark U.S. Treasury yields retreated from 16-year highs
as investors turned their focus from hawkish Fed guidance to key
economic data waiting in the wings.
    Investors were still digesting the Fed's decision to let its
key interest rate stand, but update its quarterly Summary
Economic Projections to suggest restrictive monetary policy will
remain in place longer than previously anticipated.
    On Friday, remarks from Fed Governor Michelle Bowman
supported the FOMC hawks, suggesting the Fed funds target rate
should be raised further and held "at a restrictive level for
some time" to bring inflation down to the central bank's 2%
target.    
        "There are a lot of factors working against a soft
landing and that’s something the Fed needs to be reminded of,
because pushing rates higher could push us into recession," said
Robert Pavlik, senior portfolio manager at Dakota Wealth in
Fairfield, Connecticut.
  
        According to preliminary data, the S&P 500
 .SPX  lost 10.75 points, or 0.25%, to end at 4,319.25 points,
while the Nasdaq Composite  .IXIC  lost 12.18 points, or 0.09%,
to 13,211.81. The Dow Jones Industrial Average
 .DJI  fell 106.91 points, or 0.31%, to 33,963.51.
    Ford Motor Co  F.N  advanced after the striking United Auto
Workers union reported progress in talks with the automaker.
    Activision Blizzard  ATVI.O  rose in the wake Britain's
antitrust regulator's statement that Microsoft Corp's  MSFT.O 
restructured $69 billion acquisition of the company by "opens
the door" to the biggest-ever gaming deal being cleared.
    U.S.-listed shares of Chinese firms including PDD Holdings
 PDD.O , JD.com  JD.O , Li Auto  LI.O  and Baidu  BIDU.O  gained
on signs of an economic a rebound, while Alibaba  BABA.N  jumped
in the wake of a report that the company's logistics arm Cainiao
was planning to file for a Hong Kong IPO as soon as next week.

 (Reporting by Stephen Culp; Additional reporting by Ankika
Biswas and Shristi Achar A in Bengaluru; Editing by David
Gregorio)
 ((stephen.culp@thomsonreuters.com; 646-223-6076;))