Dow Tumbles Over 300 Points Ahead of Fed Decision: Investor Sentiment Weakens, Greed Index Remains in ‘Fear’ Zone
I'm LongbridgeAI, I can summarize articles.U.S. stocks fell sharply, with the Dow dropping over 300 points, as investors braced for a likely Fed rate hike. The CNN Fear & Greed Index slipped to 28, signaling heightened fear. Treasury yields exceeded 5% and oil prices surpassed $105. While most sectors declined, energy and materials gained. Individual stocks like Forgent Power and Radiant Logistics rose on strong earnings.
The CNN Money Fear and Greed Index showed a further decline in overall market sentiment, while the index remained in the “Fear” zone on Tuesday.
U.S. stocks settled lower on Tuesday, with the Dow Jones index falling more than 300 points during the session as the 10-year Treasury yield broke above 5%, and crude oil stormed past $105 a barrel on Tuesday.
Traders are assigning roughly a 92% probability to a 25-basis-point rate hike from the Federal Reserve on Wednesday, which would be the first increase since July 2023.
Forgent Power Solutions Inc. (NYSE:FPS) shares jumped around 10% on Tuesday after the power infrastructure equipment maker reported strong fourth-quarter results and issued fiscal 2027 guidance above estimates. Radiant Logistics Inc. (NYSE:RLGT) shares climbed over 19% after the company reported better-than-expected fourth-quarter financial results.
On the economic data front, the New York Fed’s Empire State Manufacturing Index declined 13 points to a reading of 7.6 in September compared to 20.6 in August, and also missed market estimates of 14.75.
Most sectors on the S&P 500 closed on a negative note, with consumer discretionary, consumer staples and utilities stocks recording the biggest losses on Tuesday. However, energy and materials stocks bucked the overall market trend, closing the session higher.
The Dow Jones closed lower by around 328 points to 52,093.11 on Tuesday. The S&P 500 fell 0.45% to 7,585.73, while the Nasdaq Composite dipped 0.78% to 25,981.57 during Tuesday’s session.
Investors are awaiting earnings results from Lennar Corp. (NYSE:LEN) and LuxExperience BV-ADR (NYSE:LUXE) today.
What is CNN Business Fear & Greed Index?
At a current reading of 28, the index remained in the “Fear” zone on Tuesday, versus a prior reading of 31.
The Fear & Greed Index is a measure of the current market sentiment. It is based on the premise that higher fear exerts pressure on stock prices, while higher greed has the opposite effect. The index is calculated based on seven equal-weighted indicators. The index ranges from 0 to 100, where 0 represents maximum fear and 100 signals maximum greed.
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