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U.S. stocks lower as investors weigh Fed's next move

Published 05/12/2022, 16:04
© Reuters.
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By Liz Moyer

Investing.com -- U.S. stocks fell after last week’s stronger-than-expected jobs report for last month fueled speculation about the Federal Reserve’s next move on interest rates.

At 9:52 ET (14:52 GMT), the Dow Jones Industrial Average was down 236 points or 0.6%, while the S&P 500 was down 0.7% and the NASDAQ Composite was down 0.6%.

A report on the services sector output matched expectations that it would show a contraction in November. Last week, data on manufacturing showed it contracted for the first time since 2020 in October.

The Fed is meeting next week for its last policy confab for the year. The expectation is that it will raise rates again, but more likely by a smaller half-percentage point increment than it has at each of its last four meetings. 

Whether the moves will tame inflation without tipping the economy into a recession remains an open question, with some Wall Street economists foreseeing a brief downturn next year.

Shares of VF Corporation (NYSE:VFC), the maker of Timberland and other apparel, fell more than 7% after it warned on its profit outlook and launched a search for a new chief executive officer.

Oil rose after OPEC and its allies led by Russia decided to keep production cuts already agreed upon in October in place as a cap on Russian oil set in. 

Crude Oil WTI Futures rose 2.4% to $81.90 a barrel, while Brent Oil Futures crude rose 2.2% to $87.46 a barrel and Gold Futures fell 0.6% to $1798.

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