By Yasin Ebrahim
Investing.com -- The Dow closed lower Tuesday, as investor appetite for bullish bets remained sidelined by ongoing concerns that a higher for longer interest rate regime could tip the economy into recession.
The Dow Jones Industrial Average fell 1%, or 350 points, the Nasdaq Composite lost 2%, and the S&P 500 fell 1%.
Big tech remained in the firing line, paced by a more than 6% decline in Meta Platforms (NASDAQ:FB) amid increased regulatory scrutiny.
Alphabet (NASDAQ:GOOGL), Apple (NASDAQ:AAPL) and Microsoft (NASDAQ:MSFT) were down more than 2%.
The Fed is broadly expected to slow the pace of rate hikes to 0.5% at its meeting next week. But its projections about the path of future rate hikes are likely to dominate investor attention.
Recent economic data including an upside surprise in services activity and a strong monthly jobs report have stoked investor fears that Fed’s higher for longer rate regime may tip the economy into recession.
“The bottom line is that this [wage-driven inflation] isn’t an easy fix,” Eric Diton, President and Managing Director at The Wealth Alliance told Investing.com’s Yasin Ebrahim in a recent interview. "The only way the Fed's really going to get this pressure on wages down is to cause a recession, which they probably will."
Energy stocks were dragged lower by falling oil prices amid jitters about slowing global growth and worries about the oil demand outlook even as China, the world’s top energy importer, recently eased economically draining COVID restrictions.
APA Corporation (NASDAQ:APA), Marathon Oil (NYSE:MRO), and EOG Resources Inc (NYSE:EOG) led the losses, with the latter closing nearly 5% lower.
PepsiCo (NASDAQ:PEP) lost about 1% as media reports the firm is readying hundreds of job cuts at its North American snacks and beverages divisions sparked jitters about slowing growth.
Silvergate Capital (NYSE:SI), the heavily exposed lender to cryptocurrency firms, continued to rack up losses falling more than 4% even as chief executive officer Alan Lane said the bank had ample liquidity to meet customer withdrawals following the collapse of crypto exchange FTX.
In other news, Boeing Co (NYSE:BA) is set to roll out its last 747 jet, marking the end of the aircraft’s 50-year iconic reign as the company moves to produce more efficient jets.