About 10 minutes into trading, the Dow Jones Industrial Average had already dropped 0.5 per cent to 23,200.63.
The broad-based S&P 500 also fell 0.5 per cent to 2,495.26, while the tech-rich Nasdaq Composite Index slipped 0.2 per cent to 6,625.30.
Major US indices fell 1.5 per cent or more yesterday after the Fed raised the benchmark borrowing rate, even as it moderated its economic growth forecasts and signalled it expects two interest rate increases in 2019, rather than the three previously forecast.
But analysts said the dovish message was not dovish enough for the markets.
Briefing.com analyst Patrick O’Hare noted that “the stock market began to buckle and growth concerns became more prominent with signs of a slowdown abroad,” and the Fed’s assurances made that it could change its policy course, were not enough to reassure investors.
“The stock market is waking up today to a new world order that it has had some nightmares about in previous weeks and months,” O’Hare said in a research note. “Specifically, it is waking up to the reality that the Jerome Powell-led Federal Reserve isn’t inclined to ride to its rescue with market-friendly policy actions and pronouncements.”
Canaccord Genuity analyst Tony Dwyer criticised the Fed decision in light of weakening global growth forecasts, yet said “the cumulative reaction in the equity markets to an unfriendly Fed over the past two months appears overdone.” — AFP
Source: The Malay Mail Online