U.S. stocks retreat after Powell’s hawkish signals
BNN Bloomberg
Stocks resumed losses as Nvidia Corp. dragged down chipmakers after the company expressed concern about the longer-term impacts of an eventual tightening in chip-export restrictions.
The semiconductor giant, which has almost tripled in value this year amid a blistering artificial-intelligence rally, dropped 2% on Wednesday. Speaking at an investor event, Nvidia’s chief financial officer said any such ban would be a loss of opportunity. Traders also weighed Jerome Powell’s remarks as the Federal Reserve’s chief downplayed the odds of a recession while signaling officials could hike for two straight meetings, if needed.
Swap market bets on further tightening this year barely budged. The dollar climbed. Treasury two-year yields, which are more sensitive to imminent Fed moves, dropped four basis points to 4.7%.
Traders also awaited the results of the Fed’s stress test later Wednesday. While analysts don’t expect any huge negative surprises, a gauge of banks fell. Several executives have recently tempered shareholder expectations regarding dividend increases and stock buybacks — which had been the focus of investors in previous years.
