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Dow futures fall 200 points as the British pound hits record low against the dollar - CNBC

Dow futures fall 200 points as the British pound hits record low against the dollar - CNBC

Dow futures fall 200 points as the British pound hits record low against the dollar - CNBC
Sep 26, 2022 2 mins, 57 secs

The Dow Jones Industrial Average fell on Monday as investors worried surging interest rates and foreign currency turmoil could push the S&P 500 to a new closing low for the year.

The Dow fell 120 points, or 0.4%.

The British pound dropped to a record low on Monday against the U.S.

The Federal Reserve's aggressive hiking campaign, coupled with U.K.'s tax cuts announced last week has caused the U.S.

The broad-market S&P 500 temporarily broke below its June closing low and ended down 1.7%.

Another super-sized rate hike by the Federal Reserve last week was the catalyst for the latest leg downward in markets.

Bond yields soared after the Fed enacted another rate hike of 75 basis points.

In a statement released late-morning New York time, the central bank's Monetary Policy Committee stopped short of an intermeeting interest rate hike.

The S&P 500 ticked up by 0.5% in volatile trading.

Boston Federal Reserve President Susan Collins said Monday she will need to see concrete evidence that inflation is slowing before easing up on interest rate increases.

The Fed last week approved its third consecutive 0.75 percentage point interest rate hike in an effort to quell inflation running near its fastest pace since the early 1980s.

Wharton professor Jeremy Siegel criticized the Federal Reserve on Monday, saying that the central bank was "talking way too tough" on inflation now after being too slow to pivot to tighter policy earlier in the cycle.

Atlanta Federal Reserve President Raphael Bostic is holding out hope that the central bank can bring down runaway inflation without killing the economy.

"But I do think that we're going to do all that we can at the Federal Reserve to avoid deep, deep pain.

"[Whenever] the S&P Composite 1500, which consists of the S&P 500, MidCap 400, and SmallCap 600 Indices, experienced a near total absence of its sub-industries trading above both their 10-week (50-day) and 40-week (200-day) moving averages, as was the case on Friday, June 17, the low for the decline had been set," CFRA's Sam Stovall wrote in a Monday note.

The 14 day is matching the lowest since March 2020 and January 2016 before that which was a few months before the Brexit vote," Boockvar wrote in a note on Monday.

West Texas Intermediate futures fell to 77.21 on Monday, or its lowest level since early January.

The Cboe Volatility Index, known as the VIX, jumped nearly 3 points to 32.70 on Monday, hitting its highest level since mid-June.

The jump in VIX came as the sell-off in the stock market is set to deepen with S&P 500 futures falling 0.8% in premarket trading.

The sterling fell to a record low in Asia's morning, briefly shedding more than 4% to $1.0382.

2-year Treasury note climbed further to briefly mark 4.3%, after reaching new 15-year highs late last week following the Federal Reserve's latest rate hike.

"The increased probability of breaking the June S&P 500 price low may be what it takes to invoke even deeper fear," Lerner said in a note.

Stock futures opened little changed on Sunday evening after the major averages suffered steep losses in the previous week, as Federal Reserve policy, surging interest rates and foreign currency turmoil spooked investors

Futures tied to the Dow Jones Industrial Average were down by just 40 points, while S&P 500 futures and Nasdaq 100 futures fell 0.1%

Futures tied to all three of the major averages quickly fell much lower soon after premarket trading began

Summarized by 365NEWSX ROBOTS

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