These Sectors Led Wednesday’s Fed-Fueled Stock Market Sell-Off | Global News Avenue

Rate-sensitive stocks tumbled on Wednesday after the Federal Reserve scaled back its forecast for future rate cuts and projected higher inflation next year than previously expected.

Fed Cut interest rates by 25 basis points Wednesday, as market participants expected. But policymakers in a summary of economic forecasts Only two rate cuts forecast Next year, that number will be just half of what it was when they last issued their forecast in September.

Stocks in the real estate and consumer discretionary sectors, which are particularly sensitive to interest rates and the health of the economy, tumbled as market participants recalibrated their interest rate expectations.

The S&P 500 consumer discretionary industry index fell 4.6% (Tesla), down 8.3%, Amazon (Amazon), discount 4.6%. These two people were the worst performers in the game Seven major stocks Wednesday. The S&P 500 real estate industry index fell 4%.

These sectors triggered a broad sell-off that touched every corner of the stock market. Dow Jones Industrial Average The losing streak extends to 10 consecutive daysIt fell 2.6% and dropped more than 1,100 points. The S&P 500 and Nasdaq Composite fell 3% and 3.6% respectively.

this Russell 2000 The small-cap index fell 4%. Companies with smaller market caps are more likely to be unprofitable than their larger peers, increasing their reliance on borrowing. They are also more likely to hold floating rate debtmaking them particularly sensitive to interest rates.