A day after celebrating the Federal Reserve’s signal that it wouldn’t be making any jumbo-sized moves, traders woke up on Thursday deciding that the central bank will struggle to fight high inflation amid the lingering threat of a recession.
In a sharp about-face, investors sold stocks, bonds and cryptocurrencies on Thursday. At one point, the S&P 500 Index lost 4.2%, the most since June 2020, and the tech-heavy Nasdaq 100 dropped 5.7%, the most since March of that year.
“The great puking that’s happening? I didn’t expect that,” Kim Forrest, founder and chief investment officer at Bokeh Capital Partners said by phone. “We live for the days where we’ve made people money — that’s our job — and it’s cold comfort that I’m losing people less money.”
