Stocks Fluctuating Ahead of Next Fed Meeting

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A worrisome inflation report and an upcoming meeting have investors concerned.

Last week saw one of the worst stock drop-offs since June of 2020 as a particularly spicy inflation report had investors running for the hills. Values of stocks and indexes are on the downturn, with the Dow Jones in particular having shed 200 points so far. To make matters worse, the Federal Reserve is scheduled for another meeting this week, where they are projected to continue their trend of rising interest rates to try and assuage the inflation.

“As we peer into the end of 2022, we continue to anticipate choppy conditions in US equities, which we view as caught in a tug of war between deeply bearish sentiment (a contrarian / bullish signal) and ongoing concerns about further Fed tightening and its longer-term economic ramifications and downward earnings revisions,” RBC Capital Markets’ Lori Calvasina wrote in a note to clients.

Investors are growing concerned that the Federal Reserve will go too far in their efforts to aid the economy against inflation and inadvertently tip it into a full-on recession. The Fed’s meeting is scheduled to run on Tuesday, and will proceed for two days. Following that meeting, investors are also looking to keep an eye on new corporate earnings reports from companies like General Mills and Costco, as well as the new jobless report set for release on Tuesday.

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3 weeks ago