Hawkish signs from the US Federal Reserve have led equities lower, with tech stocks among the biggest hitters to drop.
Investors have been spooked by the release of minutes from the Fed’s mid-December meeting, in which the central bank’s economists had moved to tighten monetary policy. With the contents of the meeting now available, there is concern that higher interest rates could be on the way sooner rather than later.
This is bad news for many stocks, as higher interest rates make equity investing a less attractive proposition as both businesses and consumers can face higher borrowing and utility costs.
The slump was not contained to US equities. Markets in Europe and Asia have largely followed the lead of the US, while cryptocurrencies are also broadly lower.
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Here are some of today’s top stories:
In general market movements, major tech stocks like Alphabet (NASDAQ: GOOGL), Apple (NASDAQ: AAPL), Microsoft (NASDAQ: MSFT) and Meta (NASDAQ: FB) have taken a hit amid concern that the Fed might row back its asset holdings.
Other fallers from the sector included Salesforce (NYSE: CRM), Palantir (NYSE; PLTR) and Adobe (NASDAQ: ADBE).
Additionally, popular meme stocks such as GameStop (NYSE: GME), AMC Entertainment (NYSE: AMC) and Sundial Growers (NASDAQ: SNDL) lost a lot of ground on Wednesday as investors sought to offload risk.
Intel (NASDAQ: INTC) was one of the few major players in the green following an impressive showing at the annual Consumer Electronics Show in Las Vegas.
Rivian (NASDAQ: RIVN) shares have taken a tumble on the back of a big deal for one of its rivals. Amazon (NASDAQ: AMZN) has agreed to provide in-car software to Stellantis (BIT: STLA), which was formerly known as Fiat-Chrysler, despite having previously backed Rivian.
Roku (NASDAQ: ROKU) saw its share price falter amid analyst concerns that the company will be squeezed out by major players like Google and Amazon. Atlantic Equities emphasised the digital media company’s difficulties as it said the North American market was nearing saturation.
These are some of the biggest stories from Asian markets:
Many tech stocks followed their US counterparts lower, with Bilibili (HKG: 9626) and Kuaishou (HKG: 1024) both heading downwards.
However, some bucked the trend. For example, Tencent (HK: 0700) shares climbed after the tech and gaming giant’s messaging app WeChat confirmed it had hit 450 million daily average users in 2021.
Meanwhile, China Evergrande (HKG: 3333) saw its shares rise after news broke that the company will try to seek a delay on paying back its out of control debts.
Finally, here’s a bit of the latest cryptocurrency news:
Cryptocurrencies have not escaped the choppy waters of the last 24 hours. Bitcoin (BTC) and Ethereum (ETH) were both sharply lower, along with most other major digital currencies.
Anti-government protests and state-enforced internet blackouts in Kazakhstan are raising concern for crypto analysts. The former Soviet nation is the second largest crypto miner in the world after the US, but rising fuel prices have sparked major and bloody protests against President Kassym-Jomart Tokayev’s regime.
Shares in Maryland-based blockchain technology firm BTCS (NASDAQ: BTCS) have climbed after the company said it will become the first NASDAQ constituent to offer a dividend in the form of Bitcoin.