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Dow drops almost 500 points, Nasdaq sheds nearly 2% with Fed fears

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Dec 06, 2022 - 12:55 AM

ISTANBUL (AA) – The Dow Jones Industrial Average dropped nearly 500 points and the Nasdaq shed almost 2% as positive services sector figures reinvigorated fears that the US Federal Reserve may raise rates higher than expected next week.

The blue-chip Dow plummeted 482.78 points, or 1.4%, to close at 33,947.10.

The S&P 500 lost 72.86 points, or 1.79%, to end the session at 3,998.84.

The tech-heavy Nasdaq dove 221.56 points, or 1.93%, to finish at 11,239.94.

All three indexes posted their worst daily performance in almost a month.

Economic activity in the US services sector accelerated in November, which worries investors that the Fed could deliver a higher rate hike on Dec. 14 since the American economy looks strong despite most economists’ warnings about a possible recession next year.

The VIX volatility index, also known as the fear index, jumped 8.1% to 20.62. The 10-year US Treasury yield rose 2.8% to 3.601%.

The dollar index added 0.7% to 105.31, still around its highest in 20 years, while the euro fell 0.5% to $1.0485 against the greenback.

Precious metals were in negative territory. Gold was down 1.7% at $1,767 per ounce and silver lost 4% to $22.21.

Oil prices were down around 3%. Global benchmark Brent crude was trading at $83.00 per barrel for a loss of 3%, while US benchmark West Texas Intermediate crude was around $77.33, down 3.3%.

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