1.7 C
Thursday, December 2, 2021

Stock Futures Dipped 1% Following Powell Confirmation As Fed Chair

On the afternoon of Monday, stock futures saw a slump. It was a reversal of a rally that happened earlier. The slump was seemingly a reaction to President Biden announcing his nomination of Jerome Powell, the present Chairman, as the future Federal Reserve leader. In opposition, Lael Brainard, the Federal Governor, was expected to receive a nomination.

An Overview Of The Stock Futures

The Industrial Average at Dow Jones saw an increase of 17.27 points as it reached 35,619.25 when it closed. This was a decrease after it had gained over 300 points at its highest point during sessions. The Nasdaq Composite and S&P 500 fell 1.26% and 0.32% to close at 15,854.76 and 4,682.94 respectively. These were still record highs for the day.

- Advertisement -

Treasury yields and bank stocks rose following the White House’s fed announcement. JPMorgan’s stock futures increased 2.1% and Morgan Stanley’s stock futures increased almost 2.5%. The move to increase rates seemingly affected some of the tech stocks. Their stock future earnings have attracted fewer investors when they recorder higher yields.

An expert said that the day’s action was driven by more short-week, technical, dollar strength, rotational, and rates of interest. However, even if it was difficult to say the extent of Powell’s effect, the expert believed that the overall effect was positive.

Reappointing Powell served to assuage investors who were worried regarding chiefs of central banks being switched. The worry was even deeper since the economy of the country is still recovering from the pandemic. Furthermore, the country’s inflation has risen to the highest in thirty years.

- Advertisement -

The inflation has made the Federal Reserve take back what it had predicted – that the price increase that came with the reopening is going to be “transitory”.

- Advertisement -

Follow Us


Latest news