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Editorial desk

The stock market fluctuated on Wednesday after the Federal Reserve raised interest rates by the most amount since 1994, but rose higher when Federal Reserve Chairman Jerome Powell signaled that policymakers could raise rates a little. lower at the Fed meeting in late July.

Treasury yields fell sharply on Wednesday after hitting multi-year highs on Tuesday.

Tesla (TSLA) rebounded strongly on Wednesday, even as the National Highway Traffic Safety Administration said the electric vehicle giant was dominating accidents involving driver assistance systems.

Dow Jones Futures Contracts Today
Dow Jones futures were up 0.5% from fair value. S&P 500 futures were up 0.6% and Nasdaq 100 futures were up 0.7%. Futures tumbled higher as bond yields tumbled from lows.

The 10-year Treasury yield fell 3 basis points to 3.36%, well above its overnight lows. Two-year yields reversed overnight losses, rising 2 basis points to 3.3%.

US crude oil prices rose 1%.

Bitcoin traded above $22,000 again late Wednesday after hitting an 18-month low of $20,087.90 earlier this week.

Remember to work overnight on Dow Jones Futures and other places that do not necessarily translate into actual circulation in the next ordinary session Stock Market session.

Fed meeting
Policymakers voted to raise interest rates by 75 basis points for the first time since 1994 at the end of the Federal Reserve’s two-day meeting, to a range of 1.5%-1.75%.

This came after the May CPI on June 10th showed inflation unexpectedly rose to a 40-year high of 8.6%.

Fed Chair Powell, speaking at a news conference after the monetary policy meeting, said the central bank is raising interest rates “urgently” and has decided to increase “early loading.” “Inflation is very high” with tight labor markets, he said.

But Powell said the Fed could raise rates by 50 or 75 basis points at the Fed meeting in late July. He also stressed that the policy would be “sensitive and flexible”. Prior to those comments, all markets had priced themselves at 75 basis points at next month’s meeting, according to the CME FedWatch Tool. Markets still see a 70% chance of a three-quarter move in late July.

All Fed officials see interest rates rising to at least 3% by the end of the year, with an average estimate of 3.4%. They see 3.8% by the end of 2023.

The central bank is now seeing inflation at 5.2% this year, according to its personal consumption spending price index. This is higher than the target of 4.3% in March and 2.6% last December.

Policymakers expect their preferred measure of inflation, the core PCE index, to regress to a still-high 4.3% gain in the fourth quarter and decline to 2.7% by the end of 2023.

The Fed and Fed Chair Powell tried to strike a delicate balance on Wednesday. On the one hand, they wanted to take a big step against inflation and restore lost credibility. On the other hand, Powell and his colleagues don’t want policymakers to crush the economy. The sudden drop in retail sales was among many weak economic reports on Wednesday.

The central bank beat Wall Street, at least one afternoon. The leading indicators, which mixed after the Fed’s rally and when Powell started talking, jumped to intraday highs as the “flexible” Fed chairman left the possibility of a half-point move open. Stocks closed at their best but were still strong or markedly higher.

Treasury yields dropped sharply with the Powell suspension of 50 or 75, especially the two-year yield.