Stock futures were lower on Friday to close out another losing week as investors fear the Federal Reserve’s aggressive hiking campaign to fight inflation will lead to an economic downturn.
Dow Jones Industrial Average futures fell by 383 points, or 1.3%, while S&P 500 futures slid 1.3%. Nasdaq 100 futures lost 1.5%.
Friday is set to be the fourth negative session in a row for the major averages, with the Dow on track to take out its June closing low. The Fed on Wednesday enacted another super-sized rate hike of 75 basis points and indicated it would do another at its November meeting.
Bond yields have soared this week following the Fed’s actions, with the 2-year and 10-year Treasury rates hitting highs not seen in over a decade.
Stocks positioned to suffer the most in a recession have led this week’s losses with the Consumer Discretionary Select Sector SPDR Fund off by more than 5%. The Real Estate Select Sectors SPDR Fund is down by 6%.
Goldman Sachs cut its year-end S&P 500 target because of rising rates, predicting at least 4% downside from here.
Investors on Friday continued to assess whether the Fed’s recent moves signal a downturn ahead, with many believing or beginning to accept that a recession is in fact on the horizon.