Stocks Roiled by Fed Day’s Nerve-Wracking Rhetoric: Markets Wrap
- Powell stresses commitment to cooling prices as Fed lifts rate
- Yellen says US not considering blanket bank deposit insurance
This article is for subscribers only.
Wall Street traders bracing for the usually unnerving Federal Reserve decision got a double dose of stress on Wednesday, with Treasury Secretary Janet Yellen’s remarks rattling bank shares and Jerome Powell dashing hopes on rate cuts this year.
Her testimony to lawmakers that the government isn’t considering providing “blanket” deposit insurance to stabilize the banking system sent financial shares into a tailspin that weighed on broader stock indexes. The market also gave up gains as Powell said he’s prepared to keep tightening until inflation shows signs of cooling. Equities initially rose as the Fed delivered the expected 25 basis-point hike and kept its year-end rate projection intact.