US stocks open lower on hike concerns

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IOL bus mar20 US stocks Dow Jones Reuters File photo: Lucas Jackson

New York - US stocks fell in opening trade on Thursday as investors digested the possibilities of a Federal Reserve interest rate hike that could come sooner than expected.

After five minutes of trade, the Dow Jones Industrial Average was down 23.31 points (0.14 percent) at 16,198.86.

The broad-based S&P 500 edged down 1.42 (0.08 percent) to 1,859.35, while the tech-rich Nasdaq Composite Index slipped 3.98

(0.09 percent) to 4,303.62.

The losses extended Wednesday's sell-off when Fed Chair Janet Yellen said that a rate hike may begin “around six months” after the Fed's stimulus program ends, which could put it in the first half of 2015. Many rate watchers had expected the hike to come in late 2015.

“It didn't seem to matter that she noted it would depend on what conditions are like. The market only heard 'six months' and got a little crazy,” said Patrick O'Hare of Briefing.com.

He noted that the stock market had risen 1.7 percent in the Monday and Tuesday session. “Ms. Yellen's communication gaffe may just have been an ostensible catalyst to work off an overextended posture,” he said.

AFP


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