Stocks coughed up another sizable advance, the dollar jumped and gold plunged as investors continued to reprice assets to account for the Federal Reserve’s pivot to restrictive policy.

The S&P 500 erased a rally of almost 2 per cent, while the Nasdaq 100 sank to its lowest since June. The Russell 2000 of small caps entered a bear market after tumbling over 20 per cent from its peak. Tesla Inc. wiped out about US$109 billion of its value as the electric-car maker pushed back introductions of new models amid supply-chain challenges. Intel Corp. dragged down chipmakers on a disappointing outlook. The two-year Treasury yield climbed. In late trading, Apple Inc. rallied on record sales that beat estimates, while Robinhood Markets Inc. slumped after revenue missed expectations.

More than US$5 trillion has been wiped out from stock values this year as traders struggled to price the outlook for interest rates. Markets had been factoring in four quarter-point hikes in 2022, but that edged toward five after Fed Chair Jerome Powell suggested the economy and labor market could handle a faster pace if warranted. Morgan Stanley’s strategist Andrew Sheets is doubling down on a bet that U.S. stocks are turning from leaders to laggards as they struggle to adjust to an era of tighter policy.

“Market volatility is not going away anytime soon as the ‘buy the dip’ crowd has a new motto, ‘sell the rally’,” wrote Edward Moya, senior market analyst at Oanda. “Today’s stock market rally did not last as corporate America reminded us that supply-chain troubles persist, and profit forecasts are not providing any reasons to be optimistic. Many traders are still processing what happened yesterday with the Fed.”

Other corporate highlights:

  • Netflix Inc. soared as hedge fund magnate Bill Ackman acquired more than 3.1 million shares in a vote of confidence following a recent collapse in the streaming giant’s stock price.
  • Comcast Corp. plans to double spending on content for its Peacock streaming service this year in an attempt to attract more paying subscribers.
  • T. Rowe Price Group Inc. tumbled after the firm said client redemptions may continue with the Fed poised to raise rates.

Some of the main moves in markets:


  • The S&P 500 fell 0.5 per cent as of 4 p.m. New York time
  • The Nasdaq 100 fell 1.2 per cent
  • The Dow Jones Industrial Average was little changed
  • The MSCI World index fell 0.9 per cent


  • The Bloomberg Dollar Spot Index rose 0.7 per cent
  • The euro fell 0.9 per cent to US$1.1142
  • The British pound fell 0.6 per cent to US$1.3379
  • The Japanese yen fell 0.6 per cent to 115.35 per dollar


  • The yield on 10-year Treasuries declined six basis points to 1.81 per cent
  • Germany’s 10-year yield advanced two basis points to -0.06 per cent
  • Britain’s 10-year yield advanced three basis points to 1.23 per cent


  • West Texas Intermediate crude fell 0.3 per cent to US$87.07 a barrel
  • Gold futures fell 1.9 per cent to US$1,796.70 an ounce