HomeGlob NewsDow falls more than 300 points as Wall Street heads for back-to-back...

Dow falls more than 300 points as Wall Street heads for back-to-back weekly declines

Stocks were lower Friday as investors continued to sell into year-end on fears a recession is ahead next year because of the Federal Reserve’s unrelenting rate hiking.

The Dow Jones Industrial Average lost 375 points, or 1.13%. The S&P 500 fell 1.17%, while the tech-heavy Nasdaq Composite declined 0.75%. Trading could be especially volatile Friday with a large amount of options set to expire.

There are $2.6 trillion worth of index options set to expire, the highest amount “relative to the size of the equity market in nearly two years,” according to Goldman Sachs.

The sell-off was broad-based, with just 18 names in the S&P 500 trading in positive territory. The real estate and energy sectors were the biggest laggards, down 3% and nearly 2%, respectively.

Still, some traders started buying the dip in tech stocks after a miserable week for software firms. Shares of Meta rose 5% after JPMorgan upgraded shares of the social media company to overweight from neutral.

Shares of Adobe outperformed after the design software firm posted fiscal fourth-quarter earnings and guidance that topped expectations. Shares rose 6%.

With these latest declines, the indexes are poised to notch a second consecutive week of losses. The S&P 500 is off more than 1% for the week and about 5% for the month of December as hopes for a year-end rally fizzle.

Stocks have been falling this week in the wake of the Federal Reserve’s 50 basis point interest rate hike on Wednesday — the highest rate in 15 years. The central bank said it would continue hiking rates through 2023 to 5.1%, a larger figure than previously expected.

“After gouging themselves on hopes for a Fed pivot, equity traders are experiencing indigestion from [Wednesday’s] FOMC statement, which reiterated Jerome Powell’s theme of ‘higher for longer,'” said John Lynch, chief investment officer for Comerica Wealth Management.

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