U.S. stocks fell sharply on Friday, Oct. 30, as heavy selling in big technology stocks overshadowed a Federal Reserve decision that had already landed two days earlier. The Fed held interest rates steady on Oct. 28, and investors now turn to the next round of economic data.
Related coverage: Read our earlier analysis of the Fed rate decision and bond-market pressures and Wall Street’s reaction to oil prices and AI investment concerns.
Fed Holds Rates, Citing Strong Growth
The Federal Open Market Committee kept the federal funds rate target at 3¾% to 4%, according to the preliminary transcript of Chair Kevin Warsh’s Oct. 28 press conference. He said, “Economic activity is expanding at a strong pace,” and that “inflation remains elevated.” He also said job gains have kept pace with the workforce and the unemployment rate has changed little. Warsh did not give an explicit rate path. He said the committee believes “the accumulation of more information will help it determine the policy stance,” which leaves future moves dependent on incoming data. The vote was 10–2, according to the Federal Reserve’s Oct. 28 policy statement. Governors Lisa D. Cook and Beth M. Hammack dissented because they preferred a quarter-percentage-point increase. The statement does not support the claim that the Fed raised rates in September, so that claim has been removed.
Tech Selloff Drives Friday’s Losses
Stock indexes fell broadly, with the Nasdaq weakest, Yahoo Finance’s live market coverage showed. At one point on the page, the S&P 500 was down about 1.5%, the Dow about 0.7% and the Nasdaq about 2.5%. The page’s text cited somewhat different percentages, because it was updated through the session. These are intraday readings, not closing figures. Yahoo Finance attributed the declines to earnings reactions:
- Intel fell about 28% after its fourth-quarter outlook fell short, with management pointing to sluggish PC sales tied to higher memory chip prices.
- Amazon dropped about 4% after an earnings miss, with heavy capital spending weighing on free cash flow.
- Alphabet had its worst day in more than 20 years after its report, the page said, citing a market-value loss of roughly $500 billion.
The 10-year Treasury yield was about 4.95%, and the VIX volatility index rose to about 18.9. Oil was also higher, with Brent reportedly near $113 to $115 a barrel amid Middle East tensions, according to the same coverage.
Data and Fed Dates to Watch
Friday’s calendar included the third-quarter Employment Cost Index, expected to rise 0.8% after a 0.9% gain, and the October Chicago PMI, expected at 54.6 versus 58.8 previously. Yahoo Finance did not report the actual results. The next major report is the October jobs report, listed for Friday, Nov. 6, at 8:30 a.m. Eastern on an economic calendar site. The Fed’s next meeting is Dec. 8–9, when it is scheduled to publish new economic projections, per Blockchain.News.
What It Means for Investors
With the Fed saying it will wait for more information while two members favored higher rates, markets may stay sensitive to inflation and jobs data. Elevated yields and heavy spending on artificial intelligence by large technology companies are also in focus. Investors should check live quotes, since the figures above will change. This article is for news and information only and is not investment advice. Sources: Federal Reserve; Yahoo Finance; Blockchain.News.