S stocks were poised to continue their retreat on Thursday as Wall Street debated the hawkish message sent out by the Federal Reserve alongside its decision to hold interest rates steady.

S&P 500 (^GSPC) futures were down about 0.7%, after losing almost 1% in the wake of Wednesday’s decision, while Dow Jones Industrial Average (^DJI) futures dropped nearly 0.5%. Nasdaq 100 futures fell around 0.9% to continue to lead the declines.

After combing through the central bank’s forecast, investors believe its policymakers see interest rates staying “higher for longer”, even though Chair Jerome Powell stressed policy will be dependent on economic data in his press conference.

At the center of the debate is just how long that “longer” will be, given the central bank signaled another hike at one of its final two meetings this year. Goldman Sachs has pushed back its forecast for a Fed rate cut to the fourth quarter of 2024.

The prospect of a prolonged period of elevated rates has spooked some investors, as that would put pressure on stocks and bonds. The yield on the benchmark 10-year Treasury rose on Thursday, at one point touching its highest level in over 15 years.

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