U.S. stocks are falling as investors weigh outlook on rates

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U.S. stocks are falling as investors weigh outlook on rates
Credit: © Reuters.

By Liz Moyer

Investing.com -- U.S. stocks were falling as investors considered the chances of more interest rate increases in the coming months.

At 9:56 ET (14:56 GMT), the Dow Jones Industrial Average was down 43 points or 0.1%, while the S&P 500 was down 0.4% and the NASDAQ Composite was down 0.7%.

Federal Reserve Chair Jerome Powell said Tuesday that it will take a while to bring inflation in check though he acknowledged disinflationary forces were at work after successive rate hikes last year. Last week the Fed raised rates by another quarter of a percentage point.

Futures traders are forecasting another quarter-point hike in March and another in May, pushing the benchmark rate above 5%. Fed officials have also forecast the terminal rate to reach above 5%.

Several Fed officials are expected to speak this week, including New York Fed President John Williams, who appeared at a conference today. He said financial conditions look to be in line with what policymakers want to see.  

Investors were also focused on corporate earnings. Walt Disney Company (NYSE: DIS ) will report later today. Shares of Uber Technologies Inc (NYSE: UBER ) were up 3% after the ride-hailing app beat expectations for fourth-quarter earnings and sales.

Shares of Microsoft Corporation (NASDAQ: MSFT ) rose 2.4% after it revealed a generative artificial intelligence capability to its Bing search engine. Generative AI has become a hot topic since OpenAI’s ChatGPT sprang onto the scene.

Activision Blizzard Inc (NASDAQ: ATVI ) shares fell 2% after U.K. antitrust regulators said its planned merger with Microsoft could harm competition.

Oil rose. Crude Oil WTI Futures were up 0.9% to $77.81 a barrel, while Brent Oil Futures crude rose 0.6% to $84.17 a barrel. Gold Futures fell 0.1% to $1,883.

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