S&P 500 slides as Jerome Powell admits inflation could last longer

• Wall Street main indices drop between 0.23% and 0.98%, except for the Dow Jones up 0.18%.
• Fed Chairman Powell, concerned about high inflation.
• Communications and Construction drag the S&P 500 down.

The S&P 500 shed previous daily gains, drops 0.12%, sits at 4,544.36, as Fed’s Chairman Jerome Powell admits that the central banks monitor price pressures carefully and would act as required.

As the S&P500 cash market opened, the market sentiment was upbeat, with the three major US equity indices, the S&P 500, the Dow Jones Industrial, and the Nasdaq, were in the green. But as Fed Chairman Jerome Powell began his speech, conditions changed. At press time, the abovementioned indices record losses between 0.23% and 0.98%, except for the Dow Jones Industrial, up 0.18%.

The sectors of the $&P 500 which lose the most are the Communications followed by Construction, recording losses of 2.61% and 0.46%, respectively. Whereas the winners are Financials up some 1.27% and Real Estate gaining 0.74%, which lie on the back of higher US T-bond yields.

Fed Chairman Powell, concerned about high inflation

The Federal Reserve Chairman Jerome Powell said he is concerned about higher inflation and added that the central bank would monitor for signals that housholds and businesses are expecting sustained upward price pressures.

Powell added that the Fed is on track to begin the taper, and if the economy evolves as they (the Fed) expected, it will be completed by the first half of 2022. He reiterated that although he favors the timing of the QE reduction, he added, “I don’t think it is time to raise rates.”

S&P 500 Daily chart