John Hancock: Weekly Market Recap Week Ended September 11th
From record to correction
The NASDAQ on Tuesday fell into a correction, as the index was down 10% from the record high that it had set just six days earlier. Several of the market’s biggest technology stocks weighed on the NASDAQ, posting weekly declines of more than 5%.
Inflation remains below the U.S. Federal Reserve’s 2.0% target, but it’s rising, despite high unemployment. The Department of Labor on Friday reported that consumer prices rose 0.4% in August compared with July, or 1.3% from a year earlier. In contrast, the year-over-year rise was just 0.2% as recently as May.
The major U.S. stock indexes fell for the second week in a row, retreating again from the record highs that the S&P 500 and the NASDAQ achieved on September 2. The market was turbulent in a holiday-shortened week, with the NASDAQ posting a 4% decline on Tuesday followed by a nearly 3% gain on Wednesday.
While no major policy moves are expected when the U.S. Federal Reserve Board concludes a two-day policy meeting on Wednesday, Chairman Jerome Powell could offer some further details on a recent shift in how the Fed views inflation. Powell said last month that the Fed won’t worry as much as it previously had about the prospect of low interest rates triggering rising prices.